Highlights:
Bitcoin might have peaked at $119,500 as price signals indicate “overbought.”
Traders are eyeing a support retest to stabilize its latest bounce, which is approaching 10% for the week.
ETF inflows reached $1.6 billion in three days, with IBIT entering the top 20 ETFs by assets.
Bitcoin (BTC) seems poised for a brief pullback and support retest as price metrics signal “overbought.”
Traders cautioned Thursday that BTC/USD could decline after reaching six-week highs above $119,000.
RSI suggests a pause for BTC price
Bitcoin has surged nearly 10% over the last week as bulls make a comeback, mirroring the rise in gold.
Following its ascent to over $119,500 on Bitstamp, according to data from Cointelegraph Markets Pro and TradingView, market participants anticipate a cooling of the rally before further gains can be made. This is attributable to price indicators becoming overheated.
“Taking a deeper look, a pullback/retest appears rational as demonstrated by LTFs,” trader Roman noted in an X post on the subject.
“Everything is overbought but no signs of initial weakness. Simple breakout & retest.”
Evidence supporting this outlook includes the relative strength index (RSI), which is now decisively in “overbought” territory at nearly 90/100. This represents the highest four-hour readings since July, when BTC/USD first exceeded $123,000.
RSI is a classic leading indicator, with overbought levels on lower timeframes potentially signaling a market reversal.
On the daily and weekly charts, however, the situation has differed, with RSI remaining “overbought” during the last phases of earlier bull markets.
“Volume, RSI, & MACD indicate a favorable environment for a move towards 124k in the coming days,” Roman concluded.
Bitcoin ETFs highlight bullish sentiment
Furthering the RSI discussion, Caleb Franzen, founder of financial research firm Cubic Analytics, noted a bullish divergence developing for Bitcoin in relation to the S&P 500 on Wednesday.
Related: Bitcoin targets $118K as analysis deems US government shutdown a ‘non-event’
This analysis stemmed from the largest US spot Bitcoin exchange-traded fund (ETF), BlackRock’s iShares Bitcoin Trust (IBIT).
Bullish RSI divergence for Bitcoin relative to the S&P 500 (IBIT/SPY). pic.twitter.com/hGH2XZoPWc
— Caleb Franzen (@CalebFranzen) October 1, 2025
Data from UK-based investment firm Farside Investors revealed net inflows of over $1.6 billion across the US ETF sector this week. IBIT accounted for $600 million of this total.
Simultaneously, Eric Balchunas, an ETF analyst at Bloomberg Intelligence, confirmed IBIT’s ascent into the top 20 largest ETFs by assets.
“Someone inquired how long until it reaches the Top 10. It’s $50b away. If the last 12 months repeat, it may not take long. It took in $40b over the last year and surged 85%,” he noted on X.
“However, other ETFs are also gaining, so I’m not sure. If pressed, I’d set the over/under for Xmas 2026.”
This article does not constitute investment advice or recommendations. Every investment and trading decision carries risks, and readers should conduct their own research before making decisions.
