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Bitcoin has pulled back below $81,000 after narrowly missing a test of the closely watched 200-day simple moving average (SMA), currently near $83,300, on Wednesday. The broader crypto market is also trading in the red, with the CoinDesk Smart Contract Platform Select Capped Index losing more than 2% over the past 24 hours, making it the worst performer among major sector indices.
The 200-day simple moving average (SMA) is widely regarded as a key barometer of long-term market strength. A sustained move above the level would reinforce the narrative that the bear market ended the early February dip below $63,000 and that a new bull cycle is underway.
However, there is an important historical parallel worth considering. During previous bear market recoveries, BTC has tested, and at times briefly broken above, the 200-day moving average before resuming its broader downtrend. Most notably, in late March 2022, BTC climbed above $48,000 and tested the 200-day SMA, only to collapse towards $20,000 in late June.
So far, macro and market conditions remain supportive. Falling oil prices and record highs in gold, along with steady ETF inflows and improved dynamics in the chain, continue to support the case for further upside. Analysts at Marex pointed to three catalysts that could determine whether BTC extends higher.
“First, whether spot continues to buy into strength, not just buying dips. Second, whether the supply of exchanges continues to tighten, reducing immediate selling pressure. Third, whether the derivatives market remains constructive without overheating. If these line up, the path to the mid-80s opens quickly,” they said.
Alex Kuptsikevich, chief market analyst at FxPro, said BTC’s recent pullback looks more like a pause than a sign of trend exhaustion.
“This break also coincided with the RSI touching the overbought zone (>70) on daily time frames. It is worrying that the previous three touches of these levels (in August, October and January) were followed by sharp sell-offs. It is quite logical that market participants are taking a breather to assess the situation and gather strength,” he said in an email.
In traditional markets, the 10-year US Treasury yield fell to 4.32%, reversing the early month’s rise to 4.46% in a potentially positive development for risk assets.
The Bank of Japan continues to intervene in currency markets to support the anti-risk Japanese yen, while several Asian currencies remain under pressure from the latest oil price spike triggered by the Iran war. Meanwhile, Nasdaq futures continue to hover near record highs. Pay attention.
Read more: For analysis of today’s activity in altcoins and derivatives, see Crypto Markets Today. For a comprehensive list of events this week, see CoinDesk’s “Crypto Week Ahead.”
What is trending
BNY, the world’s largest custodian bank, expands crypto services in Abu Dhabi (CoinDesk): BNY, which oversees $59 trillion in assets, is working with Finstreet and the ADI Foundation to build a regulated digital asset infrastructure anchored in the Abu Dhabi Global Market (ADGM).
Oil prices fall below $100 as US-Iran tensions keep traders focused on Strait of Hormuz (CNBC): Oil prices fell in volatile trade on Thursday amid renewed tensions between the US and Iran. International benchmark Brent crude futures for July fell 1.85% to $99.40 a barrel. barrel. US West Texas Intermediate futures for June rose 1.85% to $93.21 a barrel.
Iran reviews U.S. proposal as Trump presses Tehran for deal on deal to end war (AP): Iran is reviewing the latest U.S. proposals to end the war as Trump threatens a new wave of bombings unless a deal is reached that includes reopening the Strait of Hormuz.
France moves aircraft carrier to Red Sea with eye on Hormuz mission (Reuters): France deployed its strike group to the Red Sea as part of planning a potential mission to secure the Strait of Hormuz.
Today’s signal
The chart shows bitcoin struggling to establish a firm breakout above the upper limit of the ascending channel that has defined its steady recovery from the February lows below $63,000.
Just above the upper limit is the closely watched 200-day simple moving average (SMA) near $83,300, a long-term trend indicator that many institutional and systematic traders use to gauge whether the broader market trend is bullish or bearish.
Together, the top of the channel and the 200-day SMA form an important resistance zone. A decisive break above both levels would strengthen the case that bitcoin’s rally is developing into a broader uptrend and could open the door for a move towards the mid-$80,000s.
But repeated failure to clear this area could encourage profit-taking and short-term caution, especially after bitcoin’s strong rally over the past three months.
