Bitcoin is currently trading at $81,656, showing signs of a short-term recovery after testing the lower boundary of a descending wedge pattern that has been in place since late February. The recent price action suggests a potential relief rally, with a short-term double bottom forming after the bounce.
BTCUSD has been consolidating within a well-defined falling wedge since reaching highs near $100,000 in February. The upper and lower boundaries of this channel have provided reliable resistance and support zones, with the most recent bounce occurring from the wedge’s lower boundary around $75,000.
After forming a double top pattern near the $93,500 level as mentioned in the previous analysis, Bitcoin broke below this key support, confirming the bearish reversal. Price has since been making lower highs and lower lows, characteristic of a downtrend, but the recent bounce from the $75,000 area indicates buyers are still defending this crucial support zone.
BTCUSD Technical Analysis
The stochastic oscillator has recently turned upward from oversold territory and is now approaching the overbought zone around the 80 level. This suggests the current recovery may soon face resistance, potentially leading to another leg down if sellers re-emerge at higher levels.
The MACD indicator shows a potential bullish crossover forming, with the histogram turning positive after an extended period in negative territory. While this signals improving momentum in the short term, the overall trend of the MACD remains bearish within the context of the descending channel.
Moving averages continue to provide dynamic resistance, with the 100-period MA (shown in blue on the chart) capping upside attempts around the $85,000-$86,000 region. The MA configuration still suggests bearish control as the shorter-term averages remain below the longer-term ones.
Key Bitcoin Levels to Watch
The short-term outlook appears cautiously bullish as Bitcoin attempts to recover from recent lows. However, the medium-term trend remains bearish as long as price stays contained within the descending wedge.
For traders, key levels to watch include:
- Support: $77,100 and the lower channel boundary at $75,000
- Resistance: $85,000 (100 MA), $89,600 (38.2% Fib), and the upper wedge boundary around $88,000-$90,000
A break and close above the upper wedge boundary would invalidate the bearish scenario and potentially signal a trend reversal. Conversely, a breakdown below the $75,000 support could accelerate the downward movement toward the $70,000 psychological level.
The longer-term bullish bias remains intact as long as Bitcoin maintains above the ascending trendline from mid-2023, as mentioned in the previous analysis. However, traders should exercise caution given the recent bearish price action and potential for continued volatility amid global trade tensions.
Still, it’s worth noting that risk assets have been rebounding in the past trading session on account of Trump announcing a 90-day delay in tariffs to its major trade partners, with the exception of China. This paved the way for a much-needed relief rally after weeks of market anxiety on tit-for-tat tariffs, although uncertainty remains as US-China trade relations remain tense.
Volume patterns will be critical to watch in the coming days, as sustained high-volume buying would add credibility to any recovery attempts, while diminishing volume would suggest the current bounce may be short-lived before the downtrend resumes.
