This is daily analysis from CoinDesk analyst and certified market technician Omkar Godbole.
We’ve probably all heard this phrase: “Once is an accident, twice is a coincidence, three times is a pattern.” »
The old adage applies perfectly to bitcoin market, where Friday’s crash marked the third time the bulls have failed to sustain their gains above the critical trendline drawn from the 2017 and 2021 highs, raising the possibility of a deeper decline to $100,000 or less.
This repeated failure to hold above this level highlights persistent resistance, suggesting that the trendline is now a key battleground likely defining the limits of bullish strength in this cycle. CoinDesk highlighted trendline resistance a month ago, noting that bulls failed to sustain gains above it twice.
The long wicks of the July, August and October candles signal bullish fatigue above the trendline.
At the same time, the MACD histogram on the monthly chart – while still positive – is lower than it was during the December-January rally when BTC first surpassed $100,000, indicating weakening bullish momentum. The MACD, a moving average based indicator, is widely used to identify trend changes and trend strength.
The daily chart below also paints a bearish picture.
The sharp reversal of expanding channel resistance, combined with negative readings in the standard (12, 26, 9) and longer-term (50, 100, 9) MACD histograms, indicates that the path of least resistance is downward.
The longer duration histogram, which uses 50 and 100 day EMAs and a 9 day EMA to smooth the signal, is significantly slower and less sensitive than the default setting, but better suited to filtering out short-term market noise.
Taken together, the monthly and daily charts suggest a decline to levels below $100,000, marking a test of the lower end of the expanding triangle. On the downside, the 200-day simple moving average at $107,000 could also offer support.
Bulls will need to make a break above $121,800 to invalidate the series of lower highs and reverse the bearish outlook. At press time, BTC changed hands at $114,800, according to CoinDesk data.
