Bitcoin’s recent price action has sparked intense debate among traders and analysts, with some predicting a violent rally to $180,000 in the next 90 days. The catalyst for this prediction is the 14-day relative strength index (RSI) falling below 30 in mid-November, a threshold that has historically signaled a capitulation point for traders. According to a chart shared by Global Macro Investor’s Julien Bittel, sourced from LSEG Datastream, Bitcoin’s recent price trajectory is overlaid with the average path that followed the last five RSI breaks below 30, tracing a path that ends around $180,000 about 90 days after the oversold level.
Understanding the RSI Breakout
The $180,000 waypoint is a return calculation, representing a gain of about 105% in approximately three months, or around 0.80% per day. However, it’s essential to note that the chart is not a predicted distribution but rather an average from event studies, which can obscure the differences in the paths of the five historical cases. The RSI predictions for Bitcoin oversold, as shown in the chart, provide a framework for understanding the potential price movement.
Doomer Evidence for the Four-Year Cycle and Market Top
Price movements since October have kept the “cycle” argument active, with Bitcoin hitting a high of $126,223 in October and then selling off until the end of November. The decline bottomed at $80,697 on November 21, down about 36% from the October high. This decline is already within the 35% to 55% drawdown band set in CryptoSlate’s cycle timing framework, depicting a low zone of approximately $82,000 to $57,000 if the post-halving cadence remains the governing model.
A CryptoSlate analysis focused on $106,400 as a balance point that repeatedly alternated between support and resistance. Until mid-December, Bitcoin had been below this level for weeks, which is crucial for the RSI chart, as a move towards $180,000 would almost certainly require acceptance above previous regime pivots and not just a momentum bounce within a correction zone. Flows are a practical counter-test for whether the bounce thesis is valid, with investors withdrawing a record $523 million from BlackRock’s iShares Bitcoin Trust (IBIT) on November 19, and net ETF inflows have since fallen to virtually zero.
Liquidity Conditions and the Four-Year Cycle
Julien Bittel’s claim that “the four-year cycle is dead” is based on macromechanics rather than calendar halving, linking the timing of the cycle to government debt refinancing dynamics and the maturity profile of US borrowing. The Federal Reserve Economic Data (FRED) records the federal government’s interest payments as a line item in current spending, with interest on the debt expected to exceed $1 trillion per year. Liquidity conditions are also key to the 90-day window, with the horizon of the RSI chart overlapping with macroeconomic lead-lag narratives that traders are already using.
The Federal Reserve cut interest rates to 3.50% to 3.75% in December and announced about $40 billion a month in short-term Treasury purchases (plus reinvestments) to ease year-end funding pressures. A roughly 90-day-shifted version of global M2 liquidity is often plotted against Bitcoin to illustrate how liquidity impulses can precede repricing of risk assets, although the relationship can decouple over long stretches. The correlation between Bitcoin and M2, adjusted by exactly 84 days, shows that the M2 line tracks the Bitcoin price path during upward movements, but during a downturn, M2 continues to rise while the price diverges.
Counterbalance and Confirmations
The RSI can remain extreme and still not make a permanent low, making the $180,000 path a closed system where confirmations are more important than the fact of an RSI violation. The pivotal point of the regime, $106,400, is crucial for reclaiming and holding to move from upswing to trend. Dealer tape, $86,000 to $110,000, is an out-of-band acceptance range that can reduce range trade pressure. Flow stress markers, such as the $523 million IBIT withdrawal day on November 19, serve as a risk-off-flow shock benchmark.
Bitcoin has already provided the inputs on which this debate relies: the RSI breakout in mid-November and the November 21 low near $80,697, leaving $106,400 and daily spot ETF flows as the clearest indicators of whether the recovery remains a bounce or extends towards the chart’s $180,000 path. Analyst Caleb Franzen recently raised a point worth considering: oversold values in bull markets are bullish, while oversold values in bear markets are not optimistic. Others, like MilkRoad, agree with Bittel, stating that short-term oversold signals must be interpreted within the liquidity and economic cycle.
At press time, Bitcoin is ranked No. 1 by market capitalization, with a price down 2.26% in the last 24 hours. Bitcoin has a market capitalization of $1.71 trillion with a 24-hour trading volume of $43.52 billion. The entire crypto market is valued at $2.9 trillion with a 24-hour volume of $113.91 billion, and Bitcoin dominance is currently at 59.13%. For more information, visit https://cryptoslate.com/bitcoin-just-flashed-a-rare-capitulation-signal-that-historically-triggers-a-violent-rally-to-180000-in-90-days/
