Bitcoin's RSI Reaches Overbought Levels Not Seen Since November 2024

Bitcoin's 14-day RSI reached 85.99, firmly in overbought territory where readings above 70 are typically considered stretched and values above 80 have often preceded corrections. The surge followed a ferocious multi-day rally that lifted Bitcoin from the low $60,000s to nearly $80,000, with the asset gaining over 20% in less than a week and reclaiming the 200-day moving average around $69,000.

The primary driver was a cascading short squeeze, with estimates placing total short liquidations between $3 billion and $4 billion across major exchanges. Forced buying from those liquidations amplified upward pressure in an environment of constrained supply. Additional support came from U.S. Treasury announcements of increased longer-dated bond buybacks, which helped ease yields and boost risk assets, along with renewed optimism around regulatory clarity and modest net inflows into spot Bitcoin ETFs.

Despite the rebound, Bitcoin remains far below its 52-week high near $126,000. Key support levels now sit in the mid-$70,000 range and around the 200-day moving average near $69,000. A failure to hold recent gains could expose Bitcoin to a pullback toward the $65,000 to $70,000 region that defined the previous trading range. Analysis suggests Bitcoin faces a critical technical juncture after reclaiming its weekly Bull Market Support Band, a key indicator used to distinguish bull and bear market conditions.