FameEX Hot Topics | BTC Slips Below Critical Support, Raising Risk of Further Drop

Bitcoin faced a pullback on Tuesday, falling to $105,250 after failing to break above the $109,000 level on both Sunday and Monday. The cryptocurrency’s price action has been confined between the downtrend line and moving averages, signaling that a range expansion may occur in the upcoming days. This market indecision reflects the ongoing struggle between bullish and bearish forces.

The moving averages are showing an upsloping trend, which slightly favors the bulls, yet the relative strength index (RSI) remains near the neutral midpoint. This indicates a lack of strong bullish momentum, leaving the market in a wait-and-see phase. Although there is some upward pressure, the lack of significant momentum suggests that Bitcoin could face more challenges. If the price continues to slip and stays below the moving averages, the BTC/USDT pair could drop to $104,500. A further breakdown below this level could push Bitcoin toward the psychological support level at $100,000, keeping the price within the bearish descending triangle pattern.

However, if Bitcoin rebounds from the moving averages and climbs above the downtrend line, it may signal a change in market momentum. Breaking this critical resistance could pave the way for a rise toward the neckline of an inverse head-and-shoulders pattern, a bullish formation that could trigger potential gains. A break above this key level would shift market sentiment toward a more optimistic outlook, indicating that buyers may regain control.

Currently, Bitcoin has broken below the moving averages, suggesting that short-term traders are taking profits. The $104,500 level is now a crucial support point, with buyers expected to defend it strongly. If this support fails, Bitcoin may experience a deeper decline, potentially testing the psychological $100,000 level.

For any substantial recovery, Bitcoin needs to break above the 20-day exponential moving average (EMA). This could open the path for a rally toward the downtrend line. If Bitcoin surpasses the downtrend line, it could target its all-time high of $111,980. However, as it stands, the market remains uncertain, with both upside and downside risks.

Disclaimer: The information provided in this section is for reference only and does not represent any investment advice or the official views of FameEX.