Bitcoin’s recent indicators suggest a local peak, backed by momentum readings that indicate overextension. The question of a potential correction is again relevant.
Bitcoin's Recent Performance and RSI Reading
On March 2nd, Bitcoin [BTC] experienced a 9.44% surge in a single day, marking the highest one-day gain in three months. However, once the 4-hour RSI hit 70, a price reversal occurred, leading to a 14.13% drop to $81,500 within 10 trading sessions.
Previously, Bitcoin saw a similar capital influx during the election run, reaching its then-all-time high of $88,400 on March 11th, pushing the 4-hour RSI into overbought territory. Despite this, bulls absorbed sell-side liquidity, driving BTC to a $92,647 peak two days later.
The Relative Strength Index (RSI) is a momentum oscillator measuring speed and change of price movements. An RSI above 70 typically indicates an asset may be overbought, suggesting a potential price pullback, while an RSI below 30 suggests it could be oversold, indicating potential for a rebound.
Current Bitcoin Market Status
Three months later, Bitcoin reclaimed the $88k mark for the first time in 17 days. However, on the 4-hour chart, the RSI again surged to nearly 80, raising the question of whether bulls can absorb sell-side pressure or if another March-style correction is imminent.
On March 12th, as Bitcoin’s RSI signaled overextension, Bitcoin ETFs recorded their second-highest inflow – a record $1.114 billion. This suggests that sustained institutional demand played a significant role in absorbing the impact of 120,761 BTC, worth $10.67 billion, that flooded exchanges in a single-day sell-off.
Potential Development Scenarios
As of now, Binance spot demand remains strong, with net outflows indicating continued Bitcoin accumulation. The derivatives market also reflects bullish positioning.
Both long- and short-term SOPR (Spent Output Profit Ratio) have flipped above 0, confirming that holders are now in profit. However, with Bitcoin’s 4-hour RSI in overbought territory, profit-taking pressure could escalate, potentially triggering short-term volatility. Sustained buying momentum is crucial for Bitcoin to push toward $90k.
With “reciprocal” tariffs set to take effect on April 2nd, market uncertainty remains high. If resistance holds, a corrective move toward the $82k–$83k range appears likely in the near term.
After a significant surge, Bitcoin faced signs of being overbought on the RSI, potentially leading to a price correction. Amid high market uncertainty, sustained buying momentum is key to overcoming resistance levels and driving further growth.
