Bitcoin’s Weekly RSI At Lowest Since FTX Collapse

Bitcoin’s Relative Strength Index (RSI) on the weekly chart has dipped to levels not seen since the dramatic FTX collapse in late 2022, raising alarms across the crypto community. The RSI, a technical indicator used to gauge the momentum and potential reversal points in asset prices, now sits deep in oversold territory. For many traders and analysts, this suggests that Bitcoin is currently in a heavily undervalued state — but it also reflects a broader sentiment of fear and uncertainty prevailing in the market.

The RSI falling to such low levels is typically interpreted as a sign that selling pressure has become excessive. During the FTX crash, Bitcoin was undergoing one of its most brutal declines, with investor confidence at historic lows. Today, although there has not been a major exchange collapse or regulatory shock, macroeconomic uncertainty, falling ETF inflows, and stagnant retail demand are putting pressure on Bitcoin’s price. The weekly RSI has fallen below 30 — the technical threshold for “oversold” — which historically has preceded relief rallies or full-blown reversals.

This dip in RSI is being closely watched by institutional investors and seasoned traders who use such signals to time market entries. Many are now calling this a potential accumulation zone, arguing that Bitcoin is unlikely to sustain a long-term downtrend at such low RSI levels. In fact, each time the weekly RSI has reached similar lows in the past, it has been followed by significant upward moves, as seen in early 2019 and again after the COVID crash in 2020.

Still, others caution that this time could be different. The lack of retail enthusiasm, ongoing Mt. Gox repayment fears, and potential Bitcoin sales from large government-held wallets are weighing heavily on sentiment. The absence of a strong catalyst to drive immediate demand also means that Bitcoin might remain in a sluggish phase before any meaningful bounce occurs. The RSI indicator, while useful, cannot account for these macroeconomic and on-chain factors on its own.

Interestingly, long-term holders appear unfazed by the low RSI. On-chain data suggests that older coins remain dormant, and exchange outflows are picking up. This indicates confidence from the “smart money” side of the market, which often accumulates during periods of extreme bearishness. Many analysts now view this RSI drop as a classic contrarian signal — when everyone is fearful, it may be the perfect time to buy.

Whether Bitcoin rebounds sharply or grinds sideways for weeks, the current RSI levels are a key technical signal pointing to a potential reversal. For now, all eyes remain on the charts — and whether Bitcoin can reclaim key levels before further damage is done.