The Bitcoin price has recently shown signs of a bearish reversal from the resistance trendline of the channel pattern on May 29th, suggesting that buyers may not be prepared to initiate a recovery rally just yet. From this point, the BTC price has plummeted 5% over the week and is currently trading at $26,749. This ongoing decline could soon challenge another support level at $26,500, a crucial point which will determine whether coin holders will lose more ground or not.
As indicated by the Bitcoin Fear & Greed Index, there is currently a neutral sentiment in the market, standing at 53%. A breakdown below the $26,500 support level may trigger a 5% drop in the BTC price. The intraday trading volume in Bitcoin, however, has increased by 40%, reaching a total of $12.2 billion.
The bearish reversal observed in the channel pattern may signify a bear cycle for Bitcoin. In a worst-case scenario, this potential downfall could lead the price to the lower trendline, which sits around $24,000 for BTC. Presently, the falling prices are inching closer to the notable support range of $26,600-$26,500, as sellers attempt to break below it. Successfully flipping this support and resistance area would give sellers a formidable barrier to apply downward pressure on the price.
With persistent selling, Bitcoin’s price may experience an additional 5% dip to reach $25,000, and subsequently, $24,000. For a sustained recovery to occur, the Bitcoin price needs to breach the overhead trendline of the channel pattern. Such a breakout could indicate an early sign of trend reversal, potentially reviving the previous recovery rally. The first target to complete this pattern would be $28,500.
Technical indicators provide further insights into the current market situation. The Moving Average Convergence Divergence (MACD) shows a bearish crossover between the MACD (blue) and signal (orange) lines on the weekly chart. This crossover serves as further confirmation of a potential downtrend continuation. Additionally, the Exponential Moving Average (EMA) illustrates the significance of the $26,500 level on the Bitcoin price, with its 100-day EMA slope hovering nearby.
It is crucial for potential investors to conduct thorough market research before participating in the cryptocurrency market. The opinions expressed here should not be considered financial advice, and individuals should evaluate market conditions independently. The author and publication do not assume responsibility for any personal financial losses incurred.
Source: Coingape
