Bitcoin Approaching Make-or-Break Technical Levels
As Bitcoin (BTC) hovers near critical price thresholds, the cryptocurrency world is abuzz with speculation. Trading at $87,762 at press time, Bitcoin’s recent movements suggest a possible transition into a deeper bear cycle. This has sparked concerns among traders and investors alike, following the loss of the $90,000 support level due to a broader market sell-off.
Notably, waning interest in risk assets has led to a withdrawal of institutional investors, further influencing Bitcoin’s position in the market. An analysis by TradingShot, shared on TradingView, indicates that Bitcoin is currently trading just below the one-month Bollinger Bands Basis in the mid-$80,000 range. This level has historically been a significant divider between bull and bear markets.
What Do Bollinger Bands and Moving Averages Indicate?
The Bollinger Bands Basis is a reliable long-term indicator that has consistently defined market trends for over a decade. Historically, every monthly close below this level signals the beginning of Phase 2 in a bear cycle. Bitcoin has now spent three consecutive months testing this support, and without a decisive monthly reclaim, the market may be heading toward further declines.
Key downside targets:
– The one-week MA200: Historically found near $50,000 in prior bear cycles.
– The one-week MA350: Expected around $40,000, representing a deeper bear-cycle target.
Additionally, these lows align with the 0.382–0.5 Fibonacci retracement level, reinforcing $50,000–$40,000 as a potential macro floor should bearish conditions persist. Recovery to a bullish state would require Bitcoin to reclaim the one-week MA200.
What Signals Are Traders Watching?
Currently, Bitcoin’s 14-day Relative Strength Index (RSI) sits at 41.64, indicating neutral momentum with a bias toward weakness. Meanwhile, its price is below both the 50-day simple moving average ($90,192) and the 200-day simple moving average ($104,666)—both classic bearish signals. This highlights persistent downward pressure in Bitcoin’s short- and long-term price trends.
Despite a year-to-date decline of less than 1%, the larger picture suggests a need for caution among traders. With critical support levels nearing exhaustion, Bitcoin faces a decisive moment that could either confirm a prolonged bear market or spark a recovery.
Consideration for Investors
For investors seeking opportunities amidst the volatility, a trusted cryptocurrency platform like eToro may be worth exploring. With over 30 million users worldwide, eToro offers commission-free cryptocurrency trading and the ability to copy top-performing traders in real-time.
However, it’s essential to remember that cryptocurrency investments carry significant risks. Always conduct thorough research and consult with a financial advisor before diving into this volatile market.
The Path Ahead for Bitcoin
As the broader cryptocurrency market evolves, the next few weeks will likely be pivotal for Bitcoin. Whether the number one digital currency stages a recovery or sinks deeper into bear-market territory, its movements will undoubtedly continue to shape the direction of the industry.
Stay informed and keep monitoring key price indicators to make strategic decisions in this unpredictable market.
