Bitcoin Retests Key Support Level as $53k Threshold Looms

Bitcoin has dropped to $53,800, with the technical outlook suggesting further declines to lows of $51,540 seen on 18 April

The price of Bitcoin is hovering around $53,657 as of writing, with bulls battling for control amid sell-off pressure. The benchmark crypto asset is down 3.2% and nearly 15% over the past 24-hour and 7-day time frames respectively.

Despite attempts for a swift recovery, bears have restricted prices below the 50-day and 100-day moving averages. This means that a downside continuation could see BTC fall towards recent lows.

Bitcoin price outlook

While Bitcoin’s price is vulnerable to a fresh downside, crypto analyst Rekt Capital suggests that what the market is witnessing is a retracement, not a correction, and that such dips tend to come in multiples and range around 10%-25%. This is not the case yet, however.

#BTC retraced -21% recently

Technically, this is still not a #Bitcoin  correction

Corrections tend to be -30% to -40% deep

Dips are much more common than corrections & tend to be sharper and shallower

In 2017, $BTC experienced 12 dips

These dips ranged between -10% and -25%

— Rekt Capital (@rektcapital) April 21, 2021

The technical picture for BTC/USD supports the short-term negative outlook.

BTC/USD is trading within a descending triangle pattern, with the RSI firmly below the 50-point mark to indicate bears are in control.

A possible rebound, as suggested by the appearance of a hammer candle, has stalled after bulls ran into resistance at $54,893. Recent gains were also capped around the 50-day moving average (MA) ($55,338) and 100-day MA ($55,580).

A look at the hourly chart shows that indecision seems to be resolving downwards as BTC/USD courts new losses near $53,800. If bears succeed in pushing prices below this line, the next demand zone is likely to be at the channel support line near $53,300.

Bitcoin could soon decline to $52,000, with the next  main support level found at $51,500.