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As volatility becomes the new norm, the recent drop in bitcoin exceeds a mere technical correction. It reflects a sharp disengagement of institutional capital and a questioning of the dynamics of the crypto market. Amid the panic in ETFs and rarely observed signs of undervaluation, the leader of cryptos finds itself at a critical crossroads.

The first technical signs of a possible rebound
Despite this phase of intense stress in valuations, some elements of the market reveal a different short-term dynamic.

The relative strength index (RSI) of bitcoin, measured in daily data, has now fallen between 20 and 25. This extreme oversold zone has historically preceded rebounds of more than 10% on four of the five occasions since August 2023. Bitwise notes that this setup could "open a technical window for reversal, even temporary, in a structurally weakened market."

Additionally, the cumulative volume data (CVD) on Binance and Coinbase shows a recovery in purchases, which could signal emerging support from the retail investor side. Bitwise emphasizes this point: "these bullish pressures seem to come from the spot market more than from the leveraged market, which limits forced liquidation risks."$BTC $ETH $BNB