- Bitcoin witnessed a surge in trading recently amid MicroStrategy buying 2,500 BTC.
- The $16,000 support proved impregnable for the time being.
- However, the monthly RSI is at a historic low, with some traders claiming it will even go lower.
Bitcoin recently witnessed a surge in buys and sells recently, which might have prevented the chief cryptocurrency from crashing from its $16,000 support. MicroStrategy, arguably the publicly traded company with the largest BTC holdings, even purchased an additional 2,500 coins.
However, despite the MicroStrategy buy, BTC price remained volatile. From $16,800 yesterday (December 28), BTC price went below $16,500. This would have been a non-event given the long-standing market sentiment, if not for a couple of other factors.
In detail, crypto analyst Scott Melker noted that BTC’s monthly relative strength index (RSI) is at a historic low. According to Melker, the monthly RSI “never hit oversold.”
Other notable traders commented, with some pointing out that the market sentiment is at the “weakest it has ever been.” More people echoed the same sentiment, saying that the RSI may possibly go even lower.
For the uninitiated, an asset’s RSI (stock, foreign currency, cryptocurrency, etc.) is an indicator for technical analysis. Many people deem the indicator as a reliable way of measuring market sentiment. Generally, a very low RSI means that the asset is already oversold. Conversely, a high RSI means that the particular asset is already overbought.
