Bitcoin (BTC) has extended its decline as selling pressure continues to push the BTC towards key support levels after its failed recovery attempt near its recent highs.
The decline has strengthened the bearish pressure on the cryptocurrency market as the technical structure weakens and bearish momentum persists.
At the time of writing, Bitcoin is trading at $78,263, down 6.16% over the last 24 hours, according to market data from CoinMarketCap.
Daily trading volume was approximately $81.67 billion, while Bitcoin’s total market capitalization fell to about $1.57 trillion, reflecting continued risk-off sentiment among investors.
BTC Weakens After Bear Flag Breakdown
Crypto analyst Crypto Patel pointed out the recent move as a part of a larger correction, stating that Bitcoin had corrected almost 22% from a previously identified “short zone.” He had previously warned against projections being made on social media, which were overly optimistic, with targets ranging from $200,000 to $500,000.
He had also identified a downside risk after Bitcoin had traded at a range between $95,000 and $98,000.
Following this, BTC declined to $75,500, which, as stated by Patel, aligns with his technical view. Investors who took the trade made decent profits without the need for leverage, highlighting the importance of planning over making predictions, which are often driven by emotions.
From a technical standpoint, Bitcoin’s chart is still under pressure. According to Patel, there are a number of bearish indicators that can be seen on Bitcoin’s chart.
These include a bear flag breakdown, a failed head and shoulders pattern, and a series of lower highs and lower lows. All these indicators show that sellers are currently dictating direction.
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Bitcoin Trades Below Key Averages
Also supporting the bearish case are the weekly momentum indicators. BTC’s RSI is currently at 33.20, well below the signal level of 40.22.
The price is still significantly below the moving average ribbon. The 20-week simple moving average is currently near $98,599, the 50-week simple moving average is near $100,801, and the 100-week simple moving average is near $87,405.
In the long-term chart, the 200-week SMA at $57,952 is a major support point. However, the overall moving averages indicate a long-term downtrend, suggesting it is difficult for Bitcoin to pick up momentum unless a change in market structure is seen.
This is supported by the momentum indicators, which show that the MACD is negative, with the MACD line at -5,665 and the signal line at -3,885. The histogram is still below zero, which means that the bearish momentum is not declining significantly.
Overall, the latest move in Bitcoin reminds investors that structure, risk management, and confirmation are essential in volatile markets. As the market digests the move, investors are watching to see if BTC holds key support levels or continues to fall.
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