Bitcoin trades lower after slipping below a critical level, with extended losses possibly driving prices down toward roughly $8,100
Bitcoin appears headed for further weakness after the price dropped below $9,300, signaling a breach of a key support area. Despite holding up since the stock market sell-off in March, Bitcoin fell to $9,050 in the last 24 hours after recently peaking near $10,500.
The move hands bears a plausible opportunity to press a challenge that could push the cryptocurrency beneath the critical ascending triangle pattern.
That pattern is a major bullish technical indicator on the macro price chart, so a breakdown under its lower boundary would invalidate the upward momentum that has persisted since early May.
Bitcoin’s 3.3% decline puts it trading below the ascending triangle support. Breakdowns beneath these formations typically trigger moves roughly equal to the triangle’s height. Based on the current structure, the measured move points to a potential decline of about $1,800, which would place prices near $7,500.
The Bitcoin price has also fallen beneath the 50-day moving average, which had provided support during a narrow range where prices oscillated between $9,900 and $9,300 over the past month.
That leaves the 100-day and 200-day moving averages as the next meaningful support levels. The 200-day moving average sits near $8,100. From that floor, a rebound could take prices back up toward highs around $11,800.
On-chain indicators point toward a likely price unwind
Several on-chain signals suggest deteriorating conditions for Bitcoin’s price. Charlie Morris of BlockTree observed that network velocity, transaction value, average transaction size and network fees are all falling, which is typically a bearish mix.
ByteTree’s on-chain analytics show the miners’ one-week rolling inventory (IRM) at 85%, after it spiked to 94% over the past 24 hours. The five-week IRM sits at 103%, indicating miners have been selling more Bitcoin than they are mining. If this selling pressure persists at elevated levels, it could make it difficult for prices to hold above $9,000 in the near term.
Meanwhile, the number of addresses holding more than 0.1 BTC has topped 30 million. A further drop in price at current levels could present another buying opportunity for long-term investors.
