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Bitcoin fell back below $81,000 after narrowly missing a test of the closely watched 200-day simple moving average (SMA), currently near $83,300, on Wednesday. The broader crypto market is also trading in the red, with the CoinDesk Smart Contract Platform Select Capped Index losing more than 2% in the past 24 hours, making it the worst performer among major sector indices.
The 200-day simple moving average (SMA) is widely considered a key barometer of long-term market strength. A sustained move above the level would reinforce the narrative that the bear market ended during the fall below $63,000 in early February and that a new bull cycle is underway.
There is, however, an important historical parallel that is worth considering. In previous bear market rallies, BTC has tested, and sometimes briefly exceeded, the 200-day average before resuming its broader downtrend. Most notably, in late March 2022, BTC climbed above $48,000 and tested the 200-day SMA, only to crash to $20,000 in late June.
For now, macroeconomic and market conditions remain favorable. Falling oil prices and record highs in gold, along with continued ETF inflows and improving on-chain dynamics, continue to argue for further upside. Marex analysts have highlighted three catalysts that could determine whether BTC extends higher.
“First, if spot buying continues to strengthen, not just buying dips. Second, if FX supply continues to tighten, reducing immediate selling pressure. Third, if the derivatives market remains constructive without overheating. If these align, the path to the mid-80s opens quickly,” they said.
Alex Kuptsikevich, chief market analyst at FxPro, said BTC’s recent pullback looks more like a pause than a sign of the trend exhausting.
“This break also coincided with the RSI touching the overbought zone (>70) on daily time frames. It is worrying that the previous three touches of these levels (in August, October and January) were followed by heavy selling. It is entirely logical that market participants take a break to assess the situation and regain strength,” he said in an email.
In traditional markets, the 10-year US Treasury yield fell to 4.32%, reversing the rise earlier this month to 4.46%, a potentially positive development for risk assets.
The Bank of Japan continues to intervene in foreign exchange markets to support the Japanese yen, while several Asian currencies remain under pressure from the recent surge in oil prices triggered by the war in Iran. Meanwhile, Nasdaq futures continue to hover near record highs. Stay vigilant.
Read more: For analysis of current altcoin and derivatives activity, see Crypto Markets Today. For a full list of this week’s events, check out CoinDesk’s “Crypto Week Ahead.”
What is the trend
BNY, the world’s largest depository bank, expands its crypto services in Abu Dhabi (CoinDesk): BNY, which oversees $59 trillion in assets, is working with Finstreet and the ADI Foundation to build a regulated digital asset infrastructure anchored in the Abu Dhabi Global Market (ADGM).
Oil Prices Fall Below $100 as U.S.-Iran Tensions Keep Traders Focused on Strait of Hormuz Risks (CNBC): Oil prices fell Thursday in volatile trade amid renewed tensions between the United States and Iran. International benchmark Brent crude futures for July fell 1.85% to $99.40 a barrel. US West Texas Intermediate futures for June rose 1.85% to $93.21 a barrel.
Iran reviews US proposal as Trump pressures Tehran to reach deal on ending war (AP): Iran is reviewing the latest US proposals on ending the war, as Trump threatens a new wave of bombings unless a deal is reached that includes reopening the Strait of Hormuz.
France moves aircraft carrier to Red Sea in preparation for Hormuz mission (Reuters): France has deployed its carrier strike group to the Red Sea as part of planning for a possible mission to secure the Strait of Hormuz.
Signal of the day
The chart shows Bitcoin struggling to establish a firm breakout above the upper boundary of the ascending channel that has defined its steady recovery from February lows below $63,000.
Just above the upper boundary is the closely watched 200-day simple moving average (SMA) near $83,300, a long-term trend indicator that many institutional and systematic traders use to gauge whether the broader market trend is bullish or bearish.
Taken together, the channel top and the 200-day SMA form a key resistance area. A decisive breakout above both levels would reinforce the hypothesis that Bitcoin’s rally is moving into a broader uptrend and could open the door for a move towards the mid-$80,000s.
But repeated failure to clear this area could encourage profit-taking and caution in the short term, especially after bitcoin’s strong rebound over the past three months.
