Bitcoin drops to $76,300 after flash crash as RSI hits extreme

Bitcoin's 4-hour RSI hit its highest level in more than seven years before a flash crash wiped out over $500 million in long positions.

Bitcoin dropped to $76,300 on Saturday after a flash crash from $79,500, with total liquidations exceeding $1.35 billion in 24 hours. The asset, which climbed more than 22 percent over the past week, settled near $77,260 as of market data on Aug. 22.

Analyst Krown said the RSI extreme is good for the long term but not for the short term, noting readings above 80-90 reflect temporary exhaustion of demand. "Low timeframe wave count has been pretty tricky on bitcoin since the start of our expansion because of the extended 5th subwave to the upside, but I think it might be time for a pullback/local top if the initial move is finally complete," analyst CredibleCrypto said on X.

The 4-hour RSI reached its highest level in more than seven years, while the daily RSI sits at one of its highest readings in history, according to analyst Shardi B. The flash crash from around $79,500 to a low near $76,300 liquidated more than $500 million in long positions within minutes, part of total liquidations exceeding $1.35 billion over the past 24 hours, according to market data.

Analysts remain split on direction. Crypto analyst Ted said Bitcoin is holding above its weekly bull market support band, and a weekly close above this zone is needed for more upside. Some see a target of $83,000 to $85,000 in the coming weeks, while others warn of a pullback toward $70,000 if support at $75,000 to $76,000 fails.

Liquidation data shows shorts dominated the breakout

The flash crash followed Bitcoin's 6.2 percent rise to $77,393 on Aug. 21, breaking out of a multi-week consolidation range between $65,000 and $68,000. According to Coinglass data, $865.38 million in BTC positions were liquidated, including $742.28 million in shorts versus $123.10 million in longs, meaning short liquidations represented roughly 86 percent of total liquidations. The largest single liquidation was approximately $23.60 million.

The rally was initially driven by President Trump's push for the Clarity Act, which would define whether cryptocurrency qualifies as a security or commodity and clarify jurisdiction between the SEC and CFTC. Bitcoin moved from $65,982 to intraday highs of $72,496 on Aug. 20, a single-session move of more than $6,500, according to Investing.com data.

The next major supply zone on the daily chart sits around $82,000 to $84,000, making this the key resistance area. A sustained daily move through $84,000 would open the door toward the next major overhead zone near $96,000 to $98,000. On the downside, the first level to watch is the former breakout region around $68,000 to $70,000, though a retracement toward $72,000 to $75,000 could still represent a normal post-breakout retest rather than a structural reversal.

The Bitcoin Bull Score has moved back above the 60 threshold, entering bullish territory for the first time since October 2025, with six of 10 underlying signals turning positive. The MVRV ratio is also showing a sharp upward move, resembling the type of recovery historically seen when prolonged downside phases transition into stronger advances.

This article is for informational purposes only and does not constitute investment advice.