Dual signals in the cryptocurrency market: Technical oscillators hint at a reversal in January

According to reports by PANews citing 10x Research’s weekly market report, the current cryptocurrency market appears calm on the surface but is experiencing conflicting signals internally. In particular, leading indicators such as technical oscillators are suggesting a transition to a new market phase, warranting close attention.

Discrepancy Between Surface and Depth: Signals from the Derivatives Market

The year-end market is experiencing a cyclical downturn in activity levels. Cryptocurrency trading volume has decreased by approximately 30% compared to usual levels, and overall participation continues to decline. However, subtle signals are moving beneath this subdued surface activity.

Signals from the derivatives market are even more intriguing. As orderly liquidation of futures contracts persists, funding rates have slightly increased, and leverage ratios remain high. Although ETF fund inflows, stablecoin trading activity, and futures positions are no longer correlated, giving an appearance of calm, complex reorganization of capital flows seems to be underway behind the scenes. Volatility is contracting, but the options market has entered a correction phase, which generally indicates a fundamental change in market structure rather than a trend continuation.

What Technical Oscillators and Indicators Suggest

Currently, Bitcoin’s technical signals are quite interesting. The RSI (Relative Strength Index) is rising at 43%, indicating a bullish signal, while the Stochastic Oscillator is at 30%, showing a bearish signal, creating a divergence between the two indicators. This mismatch in oscillator signals suggests the market has reached a turning point. Technical indicators are approaching critical levels, meaning even small fluctuations could trigger large asset rebalancing.

Bitcoin and Ethereum: Interpreting RSI and Oscillator Signals

Bitcoin’s Technical Signals:

Bitcoin is currently in a downtrend but shows signs of reversing to an uptrend in January. The RSI is at 43%, indicating a bullish signal, while the Stochastic Oscillator is at 30%, indicating a bearish signal. There are about 4.5% remaining before Bitcoin could trigger a trend reversal. The current major short-term resistance is at $88,421. The key resistance levels are set at $98,759. As of January 28, 2026, Bitcoin is trading near $89,500, up 1.88% over the past 24 hours.

Ethereum Outlook:

Ethereum may also see a trend reversal in January. Its RSI is at 44%, indicating a bullish signal, while the Stochastic Oscillator is at 23%, indicating a bearish signal. Similar to Bitcoin, a divergence between technical oscillators and RSI is observed. Ethereum has about 5% remaining before a trend reversal, and the current trend is downward. The key short-term resistance is at $2,991, with major resistance levels at $3,363. As of January 28, 2026, Ethereum is trading around $3,030, up 4.12% over the past 24 hours.

Volatility Contraction and Technical Signs of an Upturn

Realized volatility for Bitcoin and Ethereum has begun to decline sharply. Bitcoin’s 30-day realized volatility is at 38.2%, about 7 points below its 30-day average of 45%. Ethereum’s 30-day realized volatility is at 61.2%, roughly 5 points below its 30-day average of 66.6%. This contraction in volatility often signals an imminent large move.

Several technical oscillators are currently approaching oversold territory simultaneously. The divergence between RSI and stochastic oscillator signals is a typical pattern indicating the market may be ready to reverse upward. How these technical signals develop with the start of January will be crucial in determining future market direction.