Rare RSI breakdown, liquidity shifts and ETF flows fuel debate over whether Bitcoin’s four-year cycle has ended as prices hover near $89,000 today now.
Bitcoin is flashing a technical signal that has historically marked moments of extreme stress—and, in past cycles, the start of powerful rebounds.
The world’s largest cryptocurrency is trading near $89,000 after its 14-day relative strength index (RSI) fell below 30 in mid-November, a level widely watched by traders as a sign of capitulation. Such readings indicate heavy selling pressure and, in some cases, the exhaustion of bearish momentum.
A chart circulating among macro investors, shared by Global Macro Investor’s Julien Bittel and based on LSEG Datastream data, compares Bitcoin’s recent price action with the average path following the last five instances when RSI dropped below 30. In those episodes, Bitcoin rallied sharply, with the composite trajectory pointing toward levels near $180,000 roughly 90 days after the oversold signal.
That figure is not a price forecast but a statistical average. From current levels, a move to $180,000 would imply a gain of just over 100% in three months, highlighting the scale of volatility embedded in the historical data. Analysts caution that the average smooths out wide differences between individual cycles.
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Bitcoin’s recent decline has kept the long-running “four-year cycle” debate alive. After peaking around $126,000 in October, prices slid to a low near $80,700 on Nov. 21, a drop of about 36%. That pullback sits within the typical drawdown range observed in previous post-halving corrections, according to cycle-based analysis tracked by market researchers.
Key technical levels remain unresolved. Analysts point to roughly $106,400 as a critical regime pivot that has repeatedly acted as support and resistance. Bitcoin has spent weeks below that threshold, suggesting that any sustained rally would likely require a decisive break above it rather than a short-term momentum bounce.
Market flows offer a reality check. On Nov. 19, investors withdrew a record $523 million from BlackRock’s iShares Bitcoin Trust as prices slipped below $90,000. Since then, net inflows into spot Bitcoin exchange-traded funds have largely stalled, signaling caution among institutional participants.
Derivatives markets also suggest restraint. Options data indicate heavy dealer positioning in a broad $86,000 to $110,000 range, a structure that can dampen directional moves until prices exit the band with conviction.
Macro conditions add another layer. Bittel argues that traditional crypto cycles tied to halving events may be giving way to liquidity-driven dynamics, shaped by U.S. debt refinancing and interest-rate policy. The Federal Reserve’s December rate cut and renewed Treasury bill purchases have refocused attention on liquidity trends that often lead risk assets.
Still, history offers a warning. Oversold signals can persist without marking lasting lows. For now, Bitcoin’s RSI reset, ETF flows, and the $106,400 level stand as the clearest markers of whether the latest bounce becomes a broader advance—or fades back into range-bound trading.
