Rising Supply Pressure Threatens Bitcoin Price for 6% Drop this Week; Time to Reaccumulate?

Bitcoin-the largest cryptocurrency started the May month on a bearish note, registering an intraday loss of 2.36% at 6:50 am ET. This decline formed a new lower high in the daily time frame chart reflecting an early sign of trend reversal and continuation of ongoing correction. With sustained selling the BTC price is poised for 6% before hitting a significant support.

Key Points:

A new resistance trendline governs the ongoing correction in Bitcoin price
The $27000 mark stands as an important support of coin holders
The intraday trading volume in Bitcoin is $18.4 Billion, indicating a 74% gain.

Bitcoin Price Source-Tradingview

Last week’s recovery in Bitcoin price fails to surpass the last swing high of $30700 and takes a U-turn from the psychological resistance of $30000. Joining the peaks of these highs, a new resistance trendline can be drawn to mark the direction of the ongoing correction phase.

With a significant price drop today, the BTC price plunged below the local support of $28875. This breakdown may accelerate the selling pressure and plunge the prices 6% down to reach the combined support of $27000 and 23.6% Fibonacci retracement level.

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A potential breakdown below it will give additional confirmation for a prolonged downfall and tumble the prices by another 7% to reach the $25000 psychological support.

Anyhow, the Bitcoin price may continue the ongoing correction phase until the overhead resistance trendline is intact.

Technical Indicator

Relative Strength Index: the daily RSI slope back to the midline indicates a neutral sentiment among market participants.

Exponential Moving Average: With the recent drop, the Bitcoin price failed to sustain above the 20-day EMA slope, and dived below it. This breakout gives an additional edge to short-sellers.