BTC is in a neutral zone before the US election, showing potential with its volatility sell-off
Matrixport released a chart stating that as the U.S. presidential election approaches, market traders' anxiety has risen, but BTC still remains in the neutral zone. Currently, Bitcoin's 21-day Relative Strength Index (RSI) has dropped to 56%, far below the overbought threshold of 70%. This indicates that Bitcoin is neither overbought nor oversold.
Since a neutral RSI usually indicates that traders are less impacted by market changes, a neutral RSI implies that Bitcoin's risk premium (including high implied volatility) may decrease after the election.
This contrasts sharply with the bearish decline when the RSI value reached 80% in March, and in July and August when there was a significant rebound when the RSI was only at 25%. Considering this situation, selling volatility seems to be an attractive strategy this week.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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