Bitcoin Tests 200-Week SMA at Four-Month Low

Bitcoin declined to a four-month low and retested the 200-week simple moving average (SMA) at roughly $61,626, while the daily relative strength index (RSI) slid to about 17.35, its lowest level since 2020. The BTC/USD pair returned to the long-term trend line for the first time since October 2023.

The 200-week SMA is a long-term moving average that smooths weekly price action. It has risen steadily over time and previously acted as resistance during the 2022 bear market before the later rebound. Traders note the line as a reference for long-term trend behavior.

Social-media commentator CollinTalksCrypto described the revisit of the 200-week SMA as a “key milestone,” asking whether the price “does it bounce here or keep dropping?” The commentator added that the steep recent decline had increased the chance of a rebound but called short-term outcomes uncertain.

The daily RSI reading near 17.35 drew comparisons to lows in February 2020. An X analytics account using the name Frank A. Fetter characterized BTC/USD as “pretty much the most oversold ever.” Trader Michaël van de Poppe suggested the area could be a point to accumulate for investors with a long-term thesis on Bitcoin, while flagging corporate debt tied to Strategy (STRC) and a related depeg event as the main short-term risks. He warned that sustained downward momentum could push prices below $60,000.

Technical charts show patterns some traders identify as bear flags, and the recent breakdown resembles earlier moves within the current cycle. The combination of a test of the 200-week SMA and an extreme RSI has produced differing short-term views among market participants.

Market participants say technical levels and momentum indicators offer signals rather than guarantees. Near-term price direction will depend on liquidity conditions and how traders respond to developments tied to the corporate debt and depeg issues mentioned by analysts.