Bitcoin News Today: ETH/Nasdaq Ratio Hits Oversold Bottom, Signals Potential Rebound

The ETH/Nasdaq 100 ratio has hit a historically significant bottom, as the RSI indicator signals severe oversold conditions near 30. This pattern has emerged at a time when Ethereum's price action is drawing attention from traders and analysts, who are watching for signs of a potential rebound. Historical trends show that such bottoms often coincide with mean reversion, where the ratio could climb back into a more balanced range.

Bitcoin also appears to be entering a similar oversold phase, with its RSI against the Nasdaq 100 deeply oversold and hinting at a possible bull market. This development is particularly significant given the close link between Bitcoin and broader market sentiment. Analysts are now weighing whether macroeconomic factors-such as potential U.S. quantitative easing and direct household stimulus-could provide the necessary catalyst for a sustained rebound.

The market is also reacting to a recent $980 million Bitcoin purchase by Strategy Inc (MSTR), which brought its total holdings to 671,268 BTC. However, the stock fell sharply alongside Bitcoin, with investors expressing concerns about dilution risks and the sustainability of MSTR's Bitcoin-focused strategy as the stock fell sharply. The move raised questions about whether buying more Bitcoin is sufficient for long-term shareholder value, especially if the per-share exposure to Bitcoin does not improve as investors express concerns.

Why the Standoff Happened

The selloff in MSTR was driven by a combination of Bitcoin weakness, dilution worries, and structural overhang from index providers. While the company remains in the Nasdaq 100 for now, concerns persist about whether it should be classified as a traditional tech firm or a crypto holding vehicle. With MSCI expected to announce its final decision on how to treat digital-asset-heavy firms by January 15, 2026, the outcome could trigger large outflows.

The market's mixed reaction to Strategy's latest purchase also reflects growing unease about its capital-raising strategy. The Bitcoin buy was funded by the sale of over 4.7 million common shares and preferred stock, raising concerns that each new Bitcoin purchase could dilute existing shareholders without providing a proportional return. This dynamic has pushed the company's stock to trade more like a leveraged crypto proxy than a traditional software business as the market reacts.

How Markets Reacted

Bitcoin and Ethereum ETF flows have diverged, with Solana and XRP products attracting inflows while Bitcoin and Ethereum ETFs record heavy outflows. The latest data shows that U.S. spot XRP ETFs have now reached $1 billion in cumulative inflows, reflecting a shift in institutional demand toward non-BTC/ETH assets with clearer regulatory frameworks. At the same time, Ethereum-linked investment products are drawing renewed attention, with some analysts forecasting a 50–100% upside in the ETH/Nasdaq ratio as the market anticipates a mean reversion.

Ethereum itself has seen a technical bounce near a key support level after a recent rejection at the 20-day EMA. The ETH Foundation has outlined potential solutions to Ethereum's growing state size, including state expiry and partial statelessness, to prevent long-term centralization risks. These developments could have implications for Ethereum's scalability and performance, particularly as demand for smart contracts and decentralized finance continues to rise.

What Analysts Are Watching

Analysts and investors are closely monitoring the ETH/Nasdaq 100 ratio, with a target range of 0.16–0.22 implying a significant recovery for Ethereum relative to the Nasdaq. Given the high correlation between the two assets, a return to this range would suggest that Ethereum is regaining its role as a digital counterpart to the broader tech sector. Meanwhile, Bitcoin's RSI is also flashing a strong oversold signal, with many observers noting the potential for a broader market rally if macroeconomic tailwinds materialize.

The regulatory landscape is another key area of focus. The U.S. crypto industry has seen major wins in 2025, including the passage of federal rules for dollar-pegged tokens and the SEC's dismissal of several high-profile lawsuits against major exchanges. However, progress on market structure legislation has stalled, creating uncertainty for long-term growth. With an expected SEC "innovation exemption" on the horizon, industry players are hopeful for further clarity, but caution remains as regulatory scrutiny continues to evolve.

For now, investors are keeping a close eye on Bitcoin's price action, Ethereum's technical resilience, and the evolving regulatory environment. With both digital assets showing signs of hitting key inflection points, the coming months could see significant movement-as long as macroeconomic and index-related risks remain manageable.