As Bitcoin (BTC) recovers from its recent drop below the $75,000 support, some market observers outline the key levels that will define the direction of the flagship crypto’s next major move.
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Bitcoin Between Two Crucial Levels
Over the weekend, Bitcoin fell roughly 4.5% amid geopolitical tensions, reaching a one-month low of $74,289 before recovering. On Monday, the leading cryptocurrency surged another 1.6%, jumping back above $77,000.
Amid this performance, Ali Martinez outlined two crucial price levels that will determine whether BTC “launches into its next major expansion phase, or if it extends its current value reset to offer a premier buying opportunity.”
The analyst explained that Bitcoin has been in a consolidation phase since the February crash, moving within a channel throughout this structural reset, allowing the market to build liquidity “before its next definitive move.”
Notably, BTC is near the upper boundary of its channel following a recent rejection at the crucial $82,500 resistance. Martinez noted that buyer conviction has been aggressively scaling up as the price tests this level, with derivatives traders heavily positioning for a breakout, and funding rates recently hitting 0.4%, the highest level in over two months.
He previously explained that when funding rates climb this high, it signals that the derivatives market is “completely dominated by aggressive buyers,” and “traders are willing to pay a hefty premium just to maintain their long positions” as the predominant market bias remains significantly tilted toward an upcoming expansion.
Meanwhile, on-chain data shows that some of the largest whales have been using this tight range to “rebalance their portfolios,” redistributing over 18,447 Bitcoin, worth roughly $1.42 billion.
“This supply consolidation has placed BTC between resistance at $78,258 and support at $75,733,” he stated. Therefore, reclaiming this resistance could trigger a rally to $84,569, while losing the key support could send Bitcoin to $66,898.
More Pain To Come?
Other market observers also highlighted the $75,000 and $78,000 as the crucial levels in the short and mid-term. Daan Crypto trades emphasized that the Bitcoin bull market support band is currently between these levels.
As BTC has failed to hold the upper boundary of this band as support for two consecutive weeks, Daan affirmed that bulls “need to keep holding (…) to keep this short/mid timeframe momentum in their favor.”
He previously warned that falling below the $75,000-$76,000 area and weekly closes below it would suggest that the April-May recovery rally was “just a big deviation/dead cat bounce.”
Meanwhile, Merlijn The Trader noted that Bitcoin has been rejected from the 200-Day Moving Average (MA). According to the post, this is the same level that capped the 2022 bull trap, which led to a 40% correction from that area.
Like the other analysts, he affirmed that losing the $75,000–76,000 zone would accelerate the move to new lows, with an initial target of $67,000, where a CME Gap is located. He also pointed out that BTC’s tops tend to end the same way: three bumps on the 21-week SMA followed by the market lows
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The trader observed that after reaching its $69,000 cycle peak in 2021, Bitcoin retested the 21-week SMA on three occasions during its correction before reaching its bear market bottom.
This time, BTC has retested this key indicator twice, suggesting that another drop to the “real bottom,” near $50,000, could follow in the coming months, if history repeats.
Featured Image from Unsplash.com, Chart from TradingView.com