Bitcoin is still facing significant pressure and has yet to regain the $70,000 mark. The cryptocurrency has been on a downward trend for several weeks, which is limiting any upward movement.
Looking at historical data and on-chain signals, it seems the bearish outlook might persist. Although there was a minor rally recently, Bitcoin may continue to remain below $70,000 for the foreseeable future.
Insights from Bitcoin’s history indicate ongoing pressure
The Pi Cycle Top indicator offers valuable insight into Bitcoin’s current status. This metric relies on a 111-day moving average alongside twice the 350-day moving average, indicating an overheated market when they meet.
In contrast, if these averages are significantly apart, the asset could be undervalued. Presently, Bitcoin doesn’t seem to be showing either extreme; rather, it hovers in the middle of a more extensive bearish phase.
Historically, mid-cycle bearish phases in Bitcoin’s four-year cycle have extended beyond a year. Previous cycles have exhibited similar traits, where BTC stayed depressed before eventually rebounding.
The current gap between the 111 SMA and 350 SMA x2 hints at a continuation of the bearish trend instead of a recovery.
Return on output further supports this cautious viewpoint. The SOPR remains below the critical level of 1, pointing to many investors selling at a loss. A sustained below-1 scenario suggests limited profitability across the market.
This trend complicates recovery efforts. When Bitcoin investors sell at a loss, it often reflects fear, making it hard for the price to gain significant upward momentum until SOPR consistently moves above 1.
BTC’s price continues its downward trajectory
As of now, Bitcoin is priced at $66,443, struggling below a descending resistance level that’s been in place for almost a month. The repeated failure to break this resistance line underscores ongoing weaknesses; without increased buying pressure, BTC seems destined to stay below this trendline.
Money flow indicators reveal a strong selling pressure. The MFI shows that capital outflows are outpacing inflows. Current global economic uncertainties and geopolitical tensions contribute to risk-averse attitudes, leading to cautious moves and limiting aggressive buying.
In light of these conditions, Bitcoin’s price may continue to swing within a narrow range. Should it dip below $65,000, support at $62,893 could become vulnerable since it has already been tested twice this week.
However, shifts in macro sentiment could alter this trajectory. If Bitcoin can maintain the $66,224 support and attract new investments, it might challenge the $68,830 resistance level.
A decisive break above $70,000 would negate the current bearish outlook and signify renewed structural strength.
