Bitcoin, Momentum Completely Drained?...Warning: If 'Here' Collapses, It's Headed for $65,000

▲ Bitcoin (BTC)

Bitcoin (BTC) price has shown signs of momentum exhaustion after failing to break above the $82,000 mark, its highest point in several months, and is now on trial to defend key technical support levels.

According to crypto media outlet Cointelegraph on May 20 (local time), Bitcoin failed to maintain its upward momentum above $82,000, dropping 8%, and is currently trading at $77,200. Swissblock explained the background of the recent expanded decline to $76,000, stating that Bitcoin's positive momentum loses strength with every rebound. Swissblock diagnosed that Bitcoin is losing its ability to internally regenerate strong upward momentum, and that momentum exhaustion is not a collapse itself, but usually a process that precedes it.

Analysts' indicator analyses are also uniformly pointing to weakness. Analyst Axel Adler Jr. pointed out that Bitcoin's slow impulse performance indicator has turned negative for the first time since April. The analysis suggests that momentum is disappearing at a time of increasing macroeconomic pressure, and no rally can be confirmed until this indicator rises above 0 again. Glassnode also stated in its weekly Market Pulse report that Bitcoin's price momentum indicator plummeted by 29% from 66.7 to 47.1 in just one week. This signifies a structural change where strong upward momentum is weakening, suggesting a general breakdown in spot demand and speculative positions.

For an upward breakout, the key demand zone, the $74,000 to $75,000 support level, must be defended. This area has served as a major support level for the past two years and currently has the 50-day and 100-day exponential moving averages and the 50-day simple moving average clustered together. Investment information platform Material Indicators assessed that the fact that Bitcoin has not yet fallen below this demand zone itself could be the most bullish factor.

If this zone cannot be defended, the next defense lines are $72,000, where the 100-day simple moving average is located, and the psychological last stand at $70,000. Analyst Daan Crypto Trades warned that if the $75,000 to $76,000 support breaks, it could fall very quickly to $72,000. If even the $70,000 mark collapses, the price is highly likely to plummet to $65,000 or threaten to go below $60,000, the macro low recorded on February 6.

Analyst CryptoAmsterdam analyzed that based on the 3-day chart, it is important to maintain the orange support zone of $74,000 to $76,000 and the $72,000 defense line. If all these defense lines break, the downside targets open up to $60,000 and $50,000 respectively. Cointelegraph predicted that if the 50-day simple moving average of $75,600, which is a key benchmark for bulls, breaks, it could result in a vertical drop to $65,000.

*Disclaimer: This article is for investment reference only and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*