Bitcoin In A ‘Vulnerable Technical Environment’ – Levels To Watch

Bitcoin (BTC) began the week dropping nearly 10% from the recent highs and retesting the $84,000 area before bouncing. As price risks more downside with early bear market signals, a market observer suggested that the upcoming weeks will be crucial for BTC’s future path.

Bitcoin Holds Key Weekly Range

Last week, Bitcoin led the brief market recovery, surging from its seven-month low of $80,600 toward the $93,000 area, retesting a key weekly re-accumulation range between these two levels. However, the Sunday correction sent the price back to the range lows, raising concerns about the flagship crypto’s short-term future.

Analyst Rekt Capital highlighted that BTC is stabilizing within its weekly range, holding its position above the $82,000 range low. This area marks the top of an early 2025 liquidity cluster that developed around the 50-Week EMA, where the price has tapped with three downside wicks over the past month.

“Last week’s Weekly Close above the Range Low enabled a relief move toward $93,500,” the analyst explained, “but that level acted as clean resistance,” after Friday’s rejection. To the analyst, maintaining stability around the weekly range lows is important because further downside wicking into the cluster is probable.

BTC holds its weekly re-accumulation range. Source. Rekt Capital

However, he noted that the consolidation structure remains intact as long as BTC’s price continues to hold above the range low in the weekly timeframe. Rekt Capital added that Bitcoin continues to trade below a sharply declining Macro Downtrend that “has been dictating resistance throughout this phase of the cycle.”

Per the analysis, “A breakout soon would require reclaiming higher price levels, whereas a later attempt would meet the trendline at lower valuations, narrowing the distance between the current price and resistance.”

“In either case, the Macro Downtrend remains the dominant structural barrier, and Bitcoin’s path forward depends on whether consolidation near the Weekly Range Low can bring price closer to a meaningful test of this sharply descending level,” he continued.

BTC’s Vulnerable Technical Environment Raises Alarms

Rekt Capital also highlighted that BTC remains below the 21-Week EMA and 50-Week EMA, which could pose a problem for its future price action as the distance between these moving averages continues to narrow.

As he detailed, when these EMAs compress and ultimately cross, it tends to precede further downside. Although it usually takes weeks after the crossover for price acceleration to “fully unfold,” it still implies that the crossover risk is increasing.

The two EMAs currently represent potential resistance levels on future relief attempts, with the 50-Week EMA retest “leaving room for a future rejection if price revisits it.”

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This position, the analyst explained, places BTC in a “vulnerable technical environment” as “the convergence of the EMAs toward the Macro Downtrend creates a layered zone of resistance that will be difficult to overcome unless price can reclaim one of these moving averages and stabilise above it.”

Until Bitcoin successfully turns one of the EMAs into support, “the structure resembles the early-stage clustering seen in prior cycles where EMAs compressed before a broader bearish continuation,” the analyst concluded.

As of this writing, Bitcoin is trading at $88,294, a 2.3% increase in the daily timeframe.