After enduring a major drop to a seven-month low earlier this week, Bitcoin (BTC) showed resilience by regaining ground above the $57,000 threshold on Tuesday, sparking optimism among bullish investors who had hoped the worst of the slide was behind them.
However, the leading cryptocurrency quickly fell by more than 3% in the past few hours, falling back towards the $54,900 level, indicating a possible continuation of the prevailing situation. Downtrend.
CME Gap and Bearish Indicators for Bitcoin
Cryptocurrency analyst Rekt Capital shed light on the situation, pointing to the repeated pullbacks Bitcoin has seen following failed attempts to stabilize at higher levels. pointed out Bitcoin looks set to fill the CME gap between $53,700 and $54,600.
While the current price of $54,900 is acknowledged to be close to this gap, there is uncertainty surrounding the need to close it, especially given its relatively small size.
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The analyst wondered if this downward move could signal a volatile daily retest around the $55,800 level. Supports A level that is in line with the lows we saw in early July.
However, if the CME gap requires filling, doing so as soon as possible, while the price remains near it, could be a strategic move, according to Rekt analysis.
In addition to the bearish indicators, Julio Moreno, head of research at data analytics firm CryptoQuant, highlighted an important indicator: note Regarding the bull and bear market cycle indicator.
Moreno signaled a bearish phase for the first time since January 2023. Previous instances where the indicator signaled bearish phases coincided with major market events such as the Covid-induced sell-off in March 2020 and the Chinese mining ban in May 2021, accurately predicting the onset of bearish trends in November 2021.
Is Bitcoin’s $50K Support at Risk?
Cryptocurrency firm Material Indicators also shared a bearish near-term outlook for Bitcoin price, Raising red flags Regarding the bullish momentum of Bitcoin. In a scenario where Bitcoin bulls appear to be under siege, the company notes that Bitcoin bids have stabilized around the $50,000 level.
However, the cautionary tone is emerging as they prepare for a potential decline towards the crucial support level at $45,000 if the $50,000 level fails to hold.
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In addition to market sentiment, market expert Jesse Olson said: discoverer A sell signal is pending on the weekly chart of Bitcoin’s Heikin Ashi. If confirmed, this signal will mark the fifth such event since 2021, indicating a major shift in market dynamics.
Ultimately, it is becoming increasingly clear that Bitcoin must show strength. upward momentum In the coming days to counter the intensification of the current downtrend.
A revisit to the all-time high of $73,700, reached in March, now appears to be dependent on sustained upward moves to offset the prevailing market pressures.
Featured image by DALL-E, chart by TradingView.com
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