The market shows differences across multiple time frames.
The daily chart features Bitcoin [BTC] seems resilient. It continues to decline within a certain range around the $65k level. This type of consolidation corresponds to a strong bid, which is seen as a bullish signal for investors.
However, when we look at the weekly chart, things look a bit more worrying. BTC has closed lower for six consecutive weeks, forming a clear bearish structure.
In addition, the RSI has fallen below 25, reaching an all-time low and creating extreme oversold conditions.
Source: TradingView (BTC/USDT)
With this mixed setup, Bitcoin could be primed for a volatility trap.
Therefore, it is worth keeping an eye on the order book to see which side is really in control.
On the bullish side was the Coinbase Premium Index (CPI) has turned green again and regained the levels lost since the rally at the end of the fourth quarter.
In the meantime, ETF flows are back to net inflowsThis equates to a 125% increase in the CPI to 0.01 and an oversold RSI, indicating that US-based investors are treating the current Bitcoin crisis as a healthy consolidation rather than a sell-off.
According to AMBCrypto, timing is everything.
As BTC consolidates, liquidity clusters naturally form, creating zones where prices can react sharply. The key question is: do bulls position themselves to set a trap?
Bitcoin’s Oversold RSI Meets Busy Shorts
A historically low RSI is a clear signal that the bears have firm control over the price.
Simply put, Bitcoin’s momentum has turned sharply.
As a result, the weekly Relative Strength Index (RSI) has fallen from neutral to oversold levels, reflecting BTC’s 35% correction from its peak of $97,000 in mid-January.
As a result, liquidity on the short side has started to pile up. In reality, Analysts are now pointing out to a 7x liquidity position around the $70,000 level, a zone full of downside bets, indicating increasingly one-sided positioning.
Source: Coinglass
In this environment, Bitcoin is starting to look like a classic bear trap.
Technically the weekly RSI is in extreme oversold territory suggests that selling pressure is almost exhausted.
Meanwhile, ETF inflows and a rebound in the CPI suggest buyers are quietly taking a step back, even if sentiment still feels cautious.
According to AMBCrypto, that’s where things get interesting.
When Sentiment is trending bearishAs the positioning gets busy and the signals on the chain start to reverse, the setup creates conditions that catch overexposed shorts offside, creating pressure under BTC’s current heel.
Final summary
- Bitcoin’s weekly RSI at record lows and stacked short liquidity around $70,000 indicate busy bearish positioning.
- ETF inflows and a recovery in the Coinbase Premium Index indicate that buyers are quietly stepping in and creating a potential bear trap under Bitcoin’s current consolidation.