Bitcoin bears seem to have executed their trade finely, as the price again failed to surpass the key resistance at $71,500. As a result, the price dropped by more than 7% and is expected to continue to do so as it occurred during the previous rallies. Therefore, the price could now drop by another 7% to 10% and hit the bottom at the same levels, displaying an imperishable behaviour at the resistance.
Being divergent after the fallout in April, the BTC price has begun its recovery within an ascending parallel channel. The traders appeared to be confident regardless of the bearish pressures until the levels remained within the pattern. Unfortunately, the selling pressure, which has outpowered bullish activities in the past few days, has caused the price to drop below the channel, circulating bearish waves within the markets.
Therefore, now that the price has failed to rise above the key resistance, is it time for the Bitcoin price to test the key support at $60,000? Are the bulls unsure of the next price action?
The daily chart suggests the price has broken down the rising channel but also carries the possibility of a bullish reversal. As it occurred in the first few days of May, the BTC price may be assumed to undergo a bullish divergence. However, the descending trend may continue as the bears have already attempted to drag the levels below the local support at $65,000. Moreover, the technicals do not appear to be in favour of the crypto at the moment.
The RSI had turned bearish after the rejection at $71,500 and continues to head towards the south. The bull’s strength does not appear to outpower the bears, as they hold enough dominance, as suggested by the bull-bear power. Lastly, the buying volume remains within a restricted range, due to which the selling population appears to have a large count. Hence, these suggest the Bitcoin (BTC) price may not display a fake breakdown, but may fail to sustain itself after holding for a while.
Collectively, bearish clouds are hovering over the BTC price rally, which may bring the levels back towards the same range of around $60,000 shortly.
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