Bitcoin has been in a downtrend since Monday. By all indications, this may be the worst week of the month for the asset.
After shedding almost 2% on the first day following a failed attempt at flipping $80k, it continued downward the next day, dropping to a level not seen in a while. It dropped further on Wednesday, slipping below $75k.
The apex coin retraced to a low of $74,912 a few hours ago. It is edging closer to its third consecutive day of decline following the FOMC decision. The Federal Reserve announced no interest rate cut a few hours ago.
Although the announcement was unsurprising to many, investors were looking for a twist. It never came, resulting in the recent decline.
Zooming out, the apex coin is down 4% on the 1-week timeframe. It is heading for a bearish close for the first time after three weeks of an uptrend. However, some analysts attribute the recent downtrend to the market pricing the rate decision.
If that is the case, prices may be gearing up for a massive uptick on Thursday. The likelihood of a surge has increased following the latest rebound. BTC has since pulled back almost half of its Wednesday losses.
A closer look at the 1-day chart shows that this is not the first time the asset has rebounded off $74,900. It bounced off the level last Tuesday and surged to $79k afterwards. While these factors are accurate, other indicators tell a different story.
Bitcoin is Stuck Below True Market Mean
A recent post from APTRekt on CryptoQuant shows that Bitcoin recently failed to break above a key level. The chart below is the Market Dynamics Price. It shows five lines, but focus will be on only three.
The February dip saw the apex coin retrace below the true market mean and has trended below it for an extended period. However, the recent uptrend saw the asset retest the TMM. It has since failed to flip the mark and trends significantly lower at the time of writing.
It goes beyond just failing to break a key level. The post noted that prices will retrace even lower in the coming days. It will also spark the final leg of the bear market.
It concluded by noting that Bitcoin typically continued to decline until it reached its realized and investor price levels. A similar pattern could unfold in the coming months, with those benchmarks currently around $54K and $49K—potentially marking the cycle’s bottom.
The market dynamics price reduces the probability of a massive recovery. Additionally, the spot market volume is plummeting. One analysis noted that as of last Monday, the shark (100-1k BTC holders) were the top buyers, stacking up 96k BTC.
It indicated that the accumulation and distribution bands were contracting. It noted that the drop in buying pressure at the time will result in a notable decline.
The situation is worse at the time of writing. The sharks’ accumulation dropped to 54k on Sunday but slightly recovered the next day. Interestingly, sellers also reduced their activity during the session. However, there’s more: this is the lowest volume the apex coin has seen in almost fourteen days.
With volume declining, the chances of a massive upward push dwindle even lower.
Coinbase Premium Flips Negative
In addition to the growing concerns, the Coinbase premium flipped negative. It turned positive on Apr 8, indicating that whales and institutions were buying at the time. Following the latest shift, prices may plummet further, given that these players are selling.
Meanwhile, the Korea premium index, which shows what retailers are doing, is positive. However, this group of traders cannot guarantee a strong recovery. On Monday, selling spiked, hitting 22k. It rose higher the next day, hitting 27k.
The bearish action also extended to spot ETFs. Since Monday, selling have ramped up. As a result, net inflow flipped negative on Monday, exceeding $263 million. The trend continued the next day, with lesser losses.
In summary, all indications suggest that the fuel for the previous uptrend is gradually dwindling. This means that with the FOMC passing as was anticipated, recovery is not going to happen.
However, options data also suggest one more push at $79k before fully bearish. As usual, the largest liquidation of the week will happen on Friday. The current notional value is $1.71 billion, and total open interest exceeds 22k. For the first time in a while, the bears are leading open interest, accounting for 11,695.
It remains to be seen if they’ll be able to tilt prices in their favor. Nonetheless, the max pain price is at $76k. The Greek Table shows that prices may reclaim the pain price, but market makers will flip fully bearish at $76,500. If Bitcoin flips this hurdle, it may retest $79,000. Conversely, if it fails, remain above it, a plummet to $74k will follow.
Bitcoin Gears Up for $73k Retest
Monday marked the second failed attempt at $80k. Bitcoin retraced to almost the same level as last week. The sell zone is not budging despite two attempts. With volume plummeting and demand dwindling, the apex coin lacks what it needs to break this key mark at the time of writing.
If fundamentals remain the same, the recent pullback may be short-lived. The 1-day chart shows that prices may retrace further in the coming days, flipping its newfound support at $74,900. Previous price movement favors $73,500 as a tougher level.
Adding to the conviction that the uptrend is over is the moving average convergence divergence. For the first time since the start of April, it had a bearish crossover. A plummet to fourteen-day lows is almost inevitable.
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