Bitcoin ($BTC) formed a rare bullish Relative Strength Index (RSI) divergence on the weekly chart. This was previously a technical signal that preceded a rally of over 700%.
The weekly bullish RSI divergence is $BTCThe firm’s adjusted strength from its 2025 high of over $120,000 suggests that selling pressure may be easing, mirroring conditions seen near the bottom of the 2022 bear market.
A weekly chart shared by analyst Ali Martinez in an X post on July 18 shows Bitcoin making new lows while the RSI is forming higher lows.
This creates a bullish divergence, and this pattern often signals weakening bearish momentum and a possible trend reversal.
The analysis highlights striking similarities with Bitcoin’s 2022 bottom. During that period, $BTC After hitting a huge low around $16,000, it ended up rallying more than 700%.
The current structure shows a similar divergence near the $58,000 to $60,000 area, but the RSI is trending up from oversold territory.
Moreover, the indicator has recovered from levels near 30, suggesting that momentum is improving, although price movements remain relatively subdued. According to our analysis, this is the second time such a divergence has appeared on Bitcoin’s weekly chart since the 2022 cycle low.
However, technical analysts caution that a divergence alone does not guarantee a breakout. Bitcoin still needs to regain key resistance levels before a larger bullish trend is confirmed.
Currently, the $65,000 level is an important level, and a sustained move above that area will strengthen our bullish view.
Bitcoin basics
This bullish setting comes amid a difficult macro environment with Bitcoin trading in a wide range as investors weigh inflation data, Federal Reserve policy expectations, and geopolitical risks. nevertheless, $BTC Stocks remained resilient and rebounded towards $65,000 as US inflation data softened and spot ETF inflows resumed.
Institutional demands also remain an important theme. Cumulative total of 270,000 or more large holders $BTC Despite the large outflows of ETFs, which were worth about $16.7 billion in two weeks, this divergence has historically been seen near the bottoms of major markets.
The current pattern is similar to what happened before Bitcoin recovered from its 2022 lows, but today’s market is much larger and more institutionally driven.
As a result, replicating the 700% rally may require significantly higher capital inflows than in previous cycles.
Bitcoin price analysis
At the time of writing, the cryptocurrency was trading at $64,260, up about 0.3% in the past 24 hours and 0.45% for the week.
Bitcoin’s technical outlook remains slightly bullish in the short term. At current levels, the cryptocurrency is trading above its 50-day SMA of $63,596, indicating positive momentum in the short term. However, it remains below the 200-day SMA of $73,203, suggesting that the overall trend has not yet turned definitively bullish.
On the other hand, the 14-day RSI is 55.09, which is a neutral value that does not indicate overbought conditions, but indicates moderate buying momentum.
