According to the Relative Strength Index (RSI) indicator, Bitcoin’s recent drop of over 10% has left it in oversold territory. This could be an indication that a period of consolidation is incoming. The RSI score of just above 28, coupled with a bearish divergence earlier in the year, has caused some traders to worry that bullish momentum is waning. However, Bitcoin’s recent bounce back above $20,000 suggests that appetite for defending the 200-Day Moving Average and Realized Price levels in the $19,700-800 region remains strong. Despite this, risks remain tilted to the downside due to macro headwinds such as the US banking crisis and ongoing crypto crackdowns by US regulators. If Bitcoin fails to maintain its grip on the 200DMA and Realized Price, it could quickly drop to the support-turned-resistance $18,200-400 area.
