- Bitcoin stayed above the $34,752 support barrier, breaching which might welcome a slump to $30,000.
- Technical and on-chain metrics finally consider potential capitulation towards $30,000 or below.
- A weekly candle closing beyond $52,000 will cancel BTC’s bearishness.
Bitcoin price witnessed a massive fall after a slight upswing following the 5 May FOMC meeting. The Fed’s 50bp interest rate increase triggered volatility that saw the stock market and Bitcoin on massive plummets.
The NASDAQ 100 recorded the highest intraday drop since September 2020. Meanwhile, Bitcoin dropped 10% to print a lower low. The crash came after Cryptocurrency Twitter discussed liquidation calls on BTC investment by MicroStrategy.
For now, the company’s average price of the 129,218 $BTC sat near $30,200. Crypto Twitter debated what might happen to the $205 million Microstrategy loan to buy BTC in the marketplace registering a massive bloodbath. CFO Phong Lee highlighted the $21.5K per BTC would be an area where the company would need more collateral to escape a margin call.
BTC Price and Dominant Bears
Bitcoin price breached an ascending parallel channel that hosted it for over three months. The setup emerged from connecting two higher highs and three higher lows (created on 24 January) with trend lines. Unlike the previous retests (two), the 3rd one gradually violated the 200 3-day SMA, showing buyers losing control.
Also read:After a battle around the channel’s bottom trend-line, Bitcoin breached beneath the zone to hover at its current level of $36,431. Surprisingly, the crypto stays around a vital $34,752 mark. A rebound from this zone might launch a slight upsurge that might advance into an upward trend.
Nevertheless, things appear against bulls. A weekly candle closing beneath $34,752 will cancel the optimism and catalyze crashes to the $30,000 psychological mark. The last time BTC dropped under the crucial level, it recovered swiftly plus a closing beyond it. Therefore, losing impetus here might welcome amplified selling momentum, translating to capitulation.
Nevertheless, Bitcoin might be eyeing liquidity beneath $30K. That would mean collecting sell-stops liquidity, and BTC will likely form a bottom in the area. Market participants may stay patient until the asset establishes directional bias or a steady base.
The Long-Term Holder (LTH) metric also supports BTC’s bearishness. The LTC Spent Price indicates these holders’ spending price hovers at break-even as it meets the spot price. That shows LTHs that purchase Bitcoin in 2021 and 2022 panic selling.
Also, the latest 2-year MA retest adds credence to BTC’s bearish picture. It has plummeted under the barrier once each cycle or before bullish runs in Bitcoin’s 11-year history.
Bitcoin bulls should overcome immediate resistance levels and ensure a weekly candlestick closing beyond $52,000 to annul the bearish picture. That would form a higher high and cancel the downside narrative. Meanwhile, that can see a higher low near $45,000 and exploding to revisit the $69,000 ATH before setting new lifetime peaks.
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