Bitcoin’s Bullish RSI Divergence Echoes 2022 Bear Bottom as New Trend Phase Emerges

Technical Signals Point Toward Trend Inflection

Bitcoin’s recent price action has sparked considerable debate among market analysts regarding whether the cryptocurrency has begun transitioning into a new market cycle. After achieving a 25% rebound last week, Bitcoin encountered resistance near the $80,000 level, leaving traders uncertain about whether these gains can sustain. Attention has increasingly focused on relative strength index (RSI) signals tracked across multiple timeframes, which measure momentum by calculating an asset’s average gains and losses over a specified period.

A bullish divergence pattern—where RSI makes higher highs while price records lower lows—has historically preceded major trend reversals for Bitcoin. Data from TradingView, as reported by Cointelegraph, reveals that a comparable divergence pattern has emerged throughout 2026 to the one observed in mid-2022, occurring roughly six months before Bitcoin’s previous bear market concluded. This historical parallel has captured the attention of technical analysts attempting to gauge whether the current market downturn may be approaching its end.

Weekly RSI currently measures 58.3, representing its highest level since Bitcoin reached its all-time high of $126,200 in October 2025, having broken through a prior trend of lower highs. This sustained elevation in weekly momentum suggests strengthening upward pressure in the market.

Analyst Commentary and Historical Parallels

Jamie Coutts, chief crypto analyst at Real Vision, emphasized the significance of weekly timeframe analysis for identifying major cycle turning points. He characterized the bullish divergences observed on weekly charts as possessing substantial analytical weight, pointing to significant price appreciation that has historically accompanied previous divergence events. Coutts suggested that weekly timeframe readings remain more reliable than shorter-term signals for assessing fundamental trend shifts.

Jonatan Randin, senior market analyst at the crypto trading platform PrimeXBT, identified striking similarities to market conditions in late 2022. During that period, daily RSI expanded rapidly from 40 to 90 over a single weekly period—a pronounced move that customarily signals the beginning of a significant market phase transition. Randin suggested that while such an extreme move does not definitively confirm the bear market has ended, it indicates the market may be entering a new cycle phase.

Reconciling Overbought Readings with Historical Context

The daily timeframe presents a more complicated picture. Daily RSI currently sits at 82.93, placing it in overbought territory and marking the highest reading since November 2024. Traders interpret these overbought signals differently: some regard them as warning signs of imminent reversals, while others observe that Bitcoin’s historical bull markets have regularly featured multiple overbought periods exceeding the 70 level.

A stochastic RSI crossover—where two constituent trend lines intersect as a signal of potential bullish momentum—has now occurred. However, the indicator reached only 4.81 during this crossover, avoiding the macro lows near zero that preceded prior significant crossovers, suggesting a more modest bullish setup than previously observed turning points. The convergence of technical signals across timeframes suggests market participants are reassessing Bitcoin’s trajectory after months of weakness, with potential implications for the broader crypto ecosystem including correlated assets like XRP.

Source: Cointelegraph. Not financial advice.