Currently, Bitcoin is navigating a correction phase, with ongoing pressure on a significant resistance zone situated between $91,000 and $93,000 after a notable decline. While there has been a bit of recovery, the overall trajectory still leans downward, and the daily chart indicates that Bitcoin is approaching a crucial area where the next significant price movement might become clearer.
Bitcoin technical analysis
daily chart
Bitcoin is trapped within a clearly defined descending channel, with the price now probing the midpoint of this structure. The recent bounce from the $80,000-$83,000 demand zone has been the most vigorous buying seen in a month, yet the momentum has faded at the lower edge of the green supply area around $90,000-$93,000.
The 100-day and 200-day moving averages continue their downward path, hovering above the market and acting as a dynamic barrier. Prices staying below these moving averages will keep the macro trend bearish. A significant shift away from this bearish sentiment won’t occur unless Bitcoin rebounds strongly above the $103,000 to $106,000 mark, which intersects with the larger supply zone and prior breakdown points.
As it stands, Bitcoin is having trouble breaking through the downtrend line. Each attempt to climb into the $91,000-$93,000 range demonstrates weakening momentum, hinting that the market isn’t ready for a decisive breakout just yet.
4 hour chart
On the 4-hour chart, Bitcoin has hit a critical resistance zone marked by a bearish order block around $92,000, along with a multi-week downtrend line. If resistance holds, it may lead Bitcoin back toward the $86,000-$88,000 range. There’s still considerable liquidity present in the $80,000-$83,000 demand zone, which has proven to be a strong support level.
On the flip side, if Bitcoin closes above $93,000, it would clear the path toward the $102,000-$106,000 inefficiency zone, where the next major price reaction is anticipated. The current market situation is pivotal, and the following weeks will likely reveal whether this pullback morphs into a full retracement or if it simply continues the broader downtrend.
On-chain analysis
While technical indicators spotlight the $92,000 level as an immediate hurdle, the on-chain data points to a more formidable “second tier” of resistance just above, influenced by the average cost basis of certain market participants.
Metrics reflecting realized prices based on UTXO age bands are crucial for pinpointing support and resistance, as realized prices often serve as psychological thresholds. If Bitcoin’s spot price dips below these levels, holders may face unrealized losses. Consequently, when prices return to their average cost basis, these investors typically look to exit at breakeven, generating notable selling pressure.
The analysis currently indicates an important convergence of two distinct groups of investors.
- 1 week to 1 month cohort (green line): Represents newer buyers, perhaps those who entered during a price drop.
- 6-12 month cohort (orange line): These are medium-term holders who made their purchases at the beginning of the year.
The realized prices for both groups converge around the $96,000 to $97,000 range, creating a substantial resistance barrier. Even if Bitcoin can surpass the technical resistance at $92,000, it is likely to face headwinds near $96,000-$97,000, as these groups may look to limit their losses.
This overlap magnifies resistance through panic from short-term traders and sell-offs from longer-term investors. For the market to definitively absorb the selling pressure and signal a readiness for a higher price point, it will need to close decisively above $97,000.
