• Bitcoin’s RSI has stayed above 65 for the last few days.
• The king coin’s price remained above $41,000 despite a slight fall.

The surge in Bitcoin’s [BTC] value has generated excitement, with certain investors experiencing substantial profits. Nevertheless, certain important indicators suggest caution, particularly in the short run.

Bitcoin stays in the oversold zone

In a recent update by Santiment, a crucial Bitcoin metric, the Relative Strength Index (RSI), saw a rise alongside its rising price. Examination of the daily RSI showed that it has consistently been over 65 since the start of December.

This trend had been on even when Bitcoin was valued below $40,000. At the time of this writing, the RSI was around 77. This ongoing trend suggested that BTC was in an overbought condition at press time.

Consequently, a price correction is possible if this situation persists for an extended period.

180-day Bitcoin MVRV shows more signs of caution

The analysis of Bitcoin’s 180-day Market Value to Realized Value ratio (MVRV) has highlighted two significant signals.

First, it indicated that investors during this period have realized substantial profits, suggesting a potential forthcoming decline in price. As of the latest data, the 180-day MVRV was around 32%.

This implied that individuals who purchased Bitcoin before the recent surge have witnessed a 32% increase in the value of their holdings.

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Author: Adewale Olarinde

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