Bitcoin (BTCUSD) is currently trading at $84,968, showing signs of recovery after a significant correction from its all-time highs around $110,000 reached in late 2024.
The leading cryptocurrency appears to be challenging a descending trendline that has capped price action since February, suggesting a potential shift in momentum. Price is forming lower lows to reflect downside momentum, but oscillators are exhibiting divergence with higher lows, suggesting that a reversal may be in order.
Key Bitcoin Levels to Watch
The chart reveals several critical price levels that traders should monitor in the coming sessions. The most prominent resistance is the descending trendline that has been in place since February’s peak, currently intersecting around the $87,000 level. Breaking above this trendline would signal a potential end to the corrective phase and could trigger a more substantial recovery.
Support is evident around the $80,000 psychological level, which has underpinned price action throughout March and April. This area aligns with the 200-day moving average (red line), creating a significant support zone. A breach below this level could potentially accelerate selling toward the next major support at $75,000.
The recent price action has formed a potential inverse head and shoulders pattern on the daily timeframe, with the neckline around $86,000-$87,000. This bullish reversal pattern, if confirmed with a decisive break above the neckline, would project a target approximately equal to the pattern’s height, suggesting a potential move toward $95,000-$97,000.
Looking at the longer-term picture, Bitcoin remains above both major moving averages despite the correction, indicating that the broader uptrend that began in late 2023 remains intact. The $90,000 level represents the next significant resistance if the current bullish momentum continues, followed by the $100,000 psychological barrier.
Technical Indicators Analysis
The moving averages present a cautiously bullish picture. The 100-day moving average (blue line) is still above the 200-day moving average (red line), maintaining the golden cross formation that has been in place since late 2023.
However, the 100-day MA has begun to curve downward, suggesting some weakening in medium-term momentum. The price is currently trading between these two important moving averages, indicating a period of indecision.
The stochastic oscillator in the lower panel shows a bullish development with a notable divergence. While Bitcoin formed lower lows in March, the stochastic formed higher lows, creating a bullish divergence that often precedes price reversals. Currently, the stochastic is rising sharply from oversold territory, approaching the overbought zone, which suggests strengthening bullish momentum in the near term.
The MACD indicator (middle panel) has turned positive after a period of negativity, with the blue line crossing above the orange signal line and the histogram bars turning green and expanding. This confirms the building bullish momentum and provides additional support for a potential upside breakout.
Bitcoin Price Outlook
Bitcoin appears to be at a critical point after its correction from all-time highs. The technical setup suggests a cautiously bullish outlook for the near term, with several supporting factors:
If Bitcoin can decisively break above the descending trendline and the $87,000 level, we could see a more substantial recovery toward the $95,000 level in the coming weeks. The complex double bottom pattern, if confirmed, provides a technical target in this range.
However, traders should remain vigilant about potential rejection at the trendline. If Bitcoin fails to break above this resistance, we could see a continuation of the range-bound trading between $80,000 and $87,000 or potentially another test of lower support levels.
The overall cryptocurrency market sentiment and macro factors like interest rates and regulatory developments will also influence Bitcoin’s trajectory beyond these technical factors.
