Bitcoin is once again violating the support level located near $26,500. In doing so, it is finding a bounce on the key moving averages, which we mentioned in our last analysis. Here’s how leading market analysts view the situation.
Material Indicators again illustrate support and resistance
Analyst @MI_Algos, a regular on our list, points out the Fed chairman’s speech and indicates the distribution of market orders in the process.
We can clearly see support at $26,000, as well as resistance located near $27,500. In addition, new orders are just flowing into the market, which may further narrow the upcoming price action. They fill the area around $26,350, as well as the area around $27,150.
In the earlier data cited by @MI_Algos, one can see a very solid portion of purchase orders, spread out around $25,500. Theoretically, this could mean that any declines in the price of Bitcoin, could result in a strong attempt to rebound just from this area.
The level of interest from buyers, coincides here with our observations. Looking at the chart, we can see that the area around $25,500, is the local peak set a few weeks ago. From a technical point of view, it has the right to become support.
Maartun warns of possible government sell-off
The on-chain data analyst known as @JA_Maartun shares a very interesting observation on his Twitter account. Referring to a post posted in mid-April, he draws attention to a possible BTC sell-off by the US government. Recall that U.S. regulators own a significant portion of Bitcoin, which they expect to dump on the market this year. @JA_Maartun points out that these operations may take place at regular intervals.
The analyst concludes this hypothesis with these words:
“A friendly reminder that the second batch of about 9825 BTC could hit the market in 8 days – from now until May 26.”
If indeed such an event were to occur, the $25,500 level could soon be tested.
Dude more bearish than the rest of the market
In contrast, technical analyst @cryptodude999 sees the current price action of the leading cryptocurrency as bearish. In his view, there are legitimate concerns that Bitcoin will dive even deeper.
In the posted graphic, @cryptodude999 illustrates that Bitcoin faces the possibility of visiting the March lows. Thus, he does not rule out dips as low as $20,000.
Does this scenario have the right to come true? From the current perspective, it is difficult to judge. However, if it does, it will confirm the theory of a potentially ongoing “echo bubble.”
Seth takes a weekly perspective
Undoubtedly, Bitcoin’s current price action and prolonged yet broad consolidation is creating uncertainty about the coming days. This is noted by @seth_fin who decides to take a look at Bitcoin from a weekly perspective.
Among other things, he points out the 200-week moving average, which we have also mentioned in our analyses. In his opinion, further consolidation in its area, and a subsequent breakout, is most warranted.
If, on the other hand, you are interested in the broader opinion of our analyst, we invite you to read the article entitled: “Bitcoin defends a key support level, reaching an important milestone in the meantime.“