Bitcoin most oversold since 2020 crash: Can BTC rebound to $70K next?

Bitcoin is now at its most oversold level since the COVID-19 crash, with its daily relative strength index (RSI) near 15.5. This reading follows a roughly 30% decline in the cryptocurrency over the past month, driven by geopolitical risks, higher oil prices, and fading hopes for a 2026 Federal Reserve rate cut.

The extreme oversold reading has raised the odds of a relief rebound toward $70,000 in the coming weeks. In 2020, Bitcoin's RSI dropped to around 15.56 before the cryptocurrency rebounded by about 50%, helped by the Federal Reserve's emergency shift to near-zero interest rates and large-scale bond purchases. Similarly, in February 2026, BTC's daily RSI dropped to around 15.86, preceding a nearly 30% recovery toward $82,850.

Bitcoin bulls are defending the $60,000 support area, with bears failing to secure a decisive breakdown despite high-volume selling. Holding above this level increases the odds of an oversold bounce in the coming weeks toward the 20-day exponential moving average (20-day EMA) at around $70,650. Conversely, a decisive break below $60,000 would weaken the rebound setup and open the door to a deeper drop toward the mid-$50,000s.

The short-term holder realized profit/loss ratio has dropped to a new all-time low, falling below levels seen in previous Bitcoin drawdowns. This metric tracks whether recent buyers are selling at a profit or loss, with a deeply negative reading indicating panic selling. Crypto analyst Scott Melker noted that roughly 5.3 million BTC held by long-term holders is now underwater, above the post-FTX peak and the highest level since the March 2020 COVID crash.

Similar stress has appeared near past capitulation zones, with Bitcoin bottoming near $15,500 after FTX before rallying roughly 690% to around $126,000 in 2025. After the COVID crash, BTC rose about 1,700% from $3,800 to nearly $69,000. According to Melker, "sentiment has tracked price almost perfectly," suggesting that the current oversold conditions may be a precursor to a significant rebound.

The implications of a potential Bitcoin rebound are significant, with the cryptocurrency's price influencing the broader crypto market. A relief rebound toward $70,000 could spark a rally in other cryptocurrencies, while a deeper drop toward the mid-$50,000s could lead to a broader market downturn. As investors weigh the risks and opportunities, the coming weeks will be crucial in determining the direction of the crypto market.

In conclusion, Bitcoin's oversold conditions have raised the odds of a relief rebound toward $70,000 in the coming weeks. While the cryptocurrency's price is subject to significant volatility, the current conditions are reminiscent of past capitulation zones that preceded significant rallies. As investors navigate the complex and rapidly evolving crypto market, a deep understanding of the underlying trends and drivers will be essential in making informed investment decisions.