Bitcoin (BTC) added to its losses on December 29 with a further slide that briefly took BTC / USD below $ 46,600.
RSI flashes "oversold"
Data of Cointelegraph Markets Pro Y TradingView showed that the pair gave ground ahead of the Wall St. open to increase its 48-hour correction to 10.4%.
The latest move in a familiar pattern of behavior, the market showed that the range in which Bitcoin has operated in December is still very much at stake.
As market participants resigned themselves to a lackluster end of the year, popular trader and analyst Scott Melker noted a potential buying opportunity at current levels in short periods of time.
Bitcoin's Relative Strength Index (RSI), in addition to other bullish signals, had entered "oversold" territory during the dip in what is a classic shopping trigger.
"If you are trading small time frames, there is a very solid risk / reward of betting long here," he wrote in one of several tweets about the opportunity.
"RSI oversold, hourly on the verge of making a bullish div, in the EQ range, low-conviction sell with minimal volume."
Beautiful bullish divergence with oversold RSI on the hourly chart. Small time frame so I look for the div to build higher time frames. The 4 hour one would be the following.
Like I said, great potential R / R for a trade here back at 50K. pic.twitter.com/a6T0sPCG6X
- The wolf of all the streets (@scottmelker) December 29, 2021
Subsequently, BTC / USD bounced from the lows to return above $ 47,000.
Melker had defended the $ 52,000 pullback, arguing that "nothing had changed" overall for range Bitcoin.
Brandt: The panic sell-off "is yet to happen"
However, not everyone was optimistic.
Related: 'Net Neutral': Rising Bitcoin Exchange Balances Could Be Due To Huobi's Chinese User Blockade
Peter Brandt, the veteran trader who earlier in the week had warned of "false breakouts" in illiquid markets over the holidays, now saw room for further downside.
It is yet to happen ... https://t.co/o4I4KuVMNf
- Peter Brandt (@PeterLBrandt) December 29, 2021
A phase of "panic capitulation" worse than the appearance of early December is, however, a subject of debate.
Retail investors, others argued, were probably not prone to sell-offs at current levels, targeting increases in small-balance portfolios and evidence of strong hodl behavior throughout the year.
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