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Bitcoin (BTC) price reached a new 2023 peak of $31,200 on July 14. However, a profit-taking wave has triggered yet another retracement below $30,000. With BTC now oversold, how high can it rebound during the next Bitcoin price rally?
Despite the choppy price action in recent weeks, long-term investors have continued to double down on their bullish Bitcoin positions. What are the chances that BTC will hit $35,000 during the next rally?
Bitcoin is Approaching the Oversold Territory
According to the Relative Strength Index data, the Bitcoin price retracement could soon grind to a halt. After over a week of sideways price movement, Bitcoin is approaching the oversold territory. As shown below, Bitcoin’s daily RSI currently sits at 41. This means that it is now closer to the oversold mark at 30 than the 70 overbought territory.
The Relative Strength Index evaluates the strength and momentum of a price trend. When the RSI swings closer to 30 than 70, it suggests the underlying asset could soon become oversold and be due for a major price rebound.
Hence, strategic investors may interpret this as a signal to take bullish positions on BTC ahead of the next price rally.
Read More: Bitcoin (BTC) Price Prediction
Long-term Bitcoin Holders Maintain Bullish Stance Ahead of the Next Rally
In confirmation of this bullish projection, Santiment‘s on-chain data reveals that long-term BTC investors are HODLIng firm despite recent price correction.
As shown below, the BTC Mean Coin Age data has continued to trend upward over the last two weeks. Specifically, between July 8 and July 24, it has grown by 2% from 2,631.06 to 2,685.02.
Mean Coin Age evaluates changes in the average duration that investors are holding on to their tokens. It is derived by dividing the number of days each coin has spent in its current wallet addresses by the total number of coins in circulation.
This steady rise in Bitcoin Mean Coin Age indicates that long-term investors have maintained a bullish disposition ahead of the next price rally.
Considering the gradual progress made by various institutional firms applying for Spot Bitcoin ETF approval, the Mean Coin Age growth could be an early signal of a stronger momentum to propel BTC over the $35,000 resistance level.
BTC Price Prediction: The $28,000 Support Level To the Rescue
The above-mentioned factors indicate that BTC would likely find support around the $28,000 level. At that territory, 720,000 investors had purchased 573,440 BTC at an average price of $28,500.
To cover their long positions, they could accumulate more Bitcoin and inadvertently trigger a price rebound.
Although unlikely, BTC could retrace toward $27,500 if that support level gives way.
Conversely, Bitcoin could hit $33,000 during the next price rally if the bullish prediction is actualized. However, 2.66 million holders had bought 1.02 million Bitcoin at an average price of $30,300. If they look to book profits, it could significantly slow the rally.
Nevertheless, BTC will likely head toward $33,000 if the bullish momentum grows as predicted.