BTC/USD as of this writing is under the 29,000.00 mark early this weekend. BTC/USD saw a low of nearly 25,500.00 on the 9th of May. The move lower in Bitcoin is not surprising, considering the strong bearish trend which has been demonstrated time and again since November of 2021. The start of April saw a new onslaught emerge lower, after a brief run higher was exhibited starting in the middle of March which ran out of speculative fuel, and the downside has generated more power in May.
While a correlation between the cryptocurrency markets has been significant when technical charts are compared to U.S equities, a rather more dangerous sentiment may be mounting in Bitcoin and other cryptocurrencies. The speculative zeal which has been a driving force in Bitcoin seems to be evaporating. Yes, we have seen this show before. Over exuberance has led to all-time highs followed by breathtaking falls. Long term traders and holders of BTC/USD may feel calm as the cryptocurrency flirts with lows not seen since late December 2020, but short term speculators who keep trying to catch the next wave up may be having difficulty.
BTC/USD inability to stay above the 30,000.00 is troubling. The past couple of days Bitcoin have begun to penetrate the 29,000.00 ratio lower again. Behavioral sentiment remains ultra-fragile. Yes, a sudden storm of buying could easily brush aside technical resistance and new highs can be generated, but this ambition doesn’t seem as realistic compared to the potential Bitcoin actually may continue to move lower.
If BTC/USD were to break below the 28,000.00 level, and not be able to climb above this mark for a couple of days this could trigger additional selling. Technical long term charts can be glanced out to try and decipher what will happen next and what barriers if broken will spur on more selling. The problem that BTC/USD faces is the potential that speculative buyers will remain in short supply and not react to technical charts. Some traders may believe for the time being that profits are going to be made pursuing selling positions.
BTC/USD Outlook for June
Speculative price range for BTC/USD is 18,881.00 to 39,990.00.
As the month of June gets ready to start, speculators will need to be braced for more volatile days ahead with BTC/USD. Some traders may have thought April had produced the worst that could be seen regarding downside momentum, but May has proven to be worse. The long term bearish trend in BTC/USD remains clear and betting against it could prove dangerous and costly.
Traders who are intent on shorting BTC/USD and believe that further price erosion is going to be seen in the weeks ahead cannot be blamed. If BTC/USD breaks below the 28,600.00 mark and sees more vulnerable support levels brushed aside, speculators may have their sights on the 28,200.00 mark. Remember in the second week of May, price velocity lower did take Bitcoin down to the 25,500.00 threshold quickly. The fact that BTC/USD has not achieved a significant reversal higher and remains in a dangerous price range which highlights weakness is important.
If BTC/USD falls below the 28,000.00 mark and sees violent trading, new lows could develop quickly. Traders need to be ready for significant volatility if BTC/USD were to break below the 26,000.00 mark.
Speculators who insist on chasing upside via buying positions should use take profit orders to cash in reversals higher that they seek. The 29,000.00 mark could easily be targeted if trading persists below this level as a buy. However, traders are encouraged to monitor the price of BTC/USD and not look for resistance levels to crumble. Yes, BTC/USD could move to 30,000.00 and go higher. The 32,000.00 mark is achievable. Traders should remember that the last time the 35,000.00 mark was seen was in briefly in early May. Short term bullish speculators need to remain realistic regarding their goals in the coming weeks.