Tuesday's Market Minute: Where Will Bitcoin's Drop Stop?

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Bitcoin futures saw a brutal -14% drop on heavy volume yesterday, making for a -23% fall since the May 4 close that’s caused quite a bit of technical damage under the hood as well. May 4 was a significant day, as it was the point where /BTC finally collapsed below an upward sloping trendline beginning at the low in June of 2021 and crossing along the low closes from January and February.

The RSI for /BTC gave a bearish signal as it crossed into oversold territory yesterday, but is clawing its way back out amid today’s bounce. Yesterday also brought a big close below the lower Bollinger Band, which shows extreme price action relative to its own history and is another bearish signal. Meanwhile, the rising Average Directional Index (ADX) suggests the overall downtrend is strengthening.

Look for support in the area near 28,500, as it represents the previously mentioned lows from June as well as the open after a big gap up in December of 2021. The -2 Standard Deviation Channel gives further weight to this general area, as it’s currently near 28,100 and would be another potential support point.

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This post contains sponsored advertising content. This content is for informational purposes only and not intended to be investing advice.