Panic selling by short-term holders, combined with the RSI near record lows, suggests that BTC could be transitioning into a full capitulation regime.
Bitcoin (BTC) sellers resumed their activity on Tuesday as the BTC price dropped 4% in 24 hours to an intraday low of $62,700.
Analysts said that Bitcoin has entered an “excess loss-realization” phase, with the relative strength index (RSI) suggesting that a price bottom may be forming.
Key takeaways:
Bitcoin holders continued capitulating, pushing the BTC price below $63,000 on Tuesday.
Bitcoin’s weekly RSI is nearing record lows, signaling a potential bottom.
Bitcoin holders continue capitulating
The Short-Term Holder SOPR (STH-SOPR), which measures whether short-term holders are selling at a profit or a loss, dropped below 1 after US President Donald Trump announced a new 15% global tariff on Saturday.
Related: Negative Bitcoin funding rate may signal short squeeze above $70K
Currently at 0.95, the metric shows “renewed short-term loss realization,” CryptoQuant analyst XWIN Research Japan said in a Quicktake post on Monday, adding:
“The primary sellers are short-term holders reacting to uncertainty, rather than long-term investors distributing structurally.”
When analyzing the volume of coins spent at a loss, the seven-day estimated moving average (EMA) of Bitcoin’s short-term holder net realized losses had cooled to $500 million per day, after rising as high as $1.24 billion per day on Feb. 6.
Glassnode said:
“While the intensity has cooled, the broader regime still signals a market under pressure, with participants in the base formation phase continuing to capitulate.”
The 90-day simple moving average (SMA) of Bitcoin’s realized profit/loss ratio has “now fallen below 1, confirming a full transition into an excess loss-realization regime,” Glassnode said.
Bitcoin’s “most oversold” RSI could be a bottom
Bitcoin’s weekly relative strength index, which measures the speed and change of price movements, reached its “most oversold” score of 25.71 on Tuesday.
These levels were last seen on July 22, a few months before the BTC price bottomed at $15,500 and then embarked on a bull run.
In all previous capitulation events when the RSI hit such extreme levels, short-term weakness was common, but a long-term recovery followed every time.
Bitcoin’s weekly RSI is the “most oversold it has ever been, currently at 25.6, which is lower than the previous record low level back after 3AC/Luna crash,” crypto analyst Nic Puckrin said in an X post on Tuesday, adding:
“More downside is likely, but a bottom could be coming soon.”
As Cointelegraph reported, Bitcoin’s fear and greed index is at historic lows while the number of bulls predicting new all-time highs is declining, which may be healthy market indicators for a macro bottom.
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