Bitcoin, May to Close with a Decline?..."If Bear Flag Breaks, June Will See a Sharp Drop"

▲ Bitcoin (BTC) / ChatGPT generated image

Bitcoin (BTC) is continuing its upward trend in May. However, some technical analysts are warning of a potential monthly close with a decline. With analyses suggesting that the recent rebound might not be a trend reversal but rather a bear flag preceding a continued downtrend, the 200-day moving average has emerged as a key turning point.

According to crypto media outlet NewsBTC on May 6 (local time), crypto analyst Leshka stated in a technical analysis shared on X (formerly Twitter) that Bitcoin is likely to close May with a decline. Leshka analyzed that while Bitcoin is rebounding within an ascending channel on the daily chart, this structure could be interpreted as a bear flag, signifying a temporary rebound within a downtrend.

Following a sharp drop in February, Bitcoin recovered from the $60,000 range to the $80,000 range, showing a pattern of higher highs and higher lows. While superficially appearing to strengthen its recovery, Leshka judged that this ascending channel could be a pattern formed during a limited rebound after a significant decline. A bear flag refers to a structure where, after a large drop, the price forms a gentle ascending channel, then breaks below the channel's lower boundary, leading to further declines.

The most critical price level in this analysis is around $82,000, where the 200-day moving average is located. NewsBTC reported that Bitcoin is currently approaching a resistance zone where the upper boundary of the recent ascending channel overlaps with the 200-day moving average. Bitcoin has not managed to close above the 200-day moving average on a daily basis for seven months, and this zone has been identified as a key benchmark distinguishing a mere rebound from a trend reversal.

According to the bearish scenario presented by Leshka, Bitcoin could make one last attempt to rise in the resistance zone before reversing direction. If it then breaks out of the ascending channel, there is a possibility of a decline to the $58,000 to $56,000 range by June. However, this analysis is a technical scenario predicated on the price reaction around the 200-day moving average.

Bitcoin's performance in May is also facing a significant test when compared to historical statistics. According to NewsBTC, Bitcoin has historically recorded an average return of 18.7% and a median of 8.32% in May, with gains of 11.1% in May 2024 and May 2025, respectively. In contrast, it fell by 35.4% in May 2021, 15.9% in May 2022, and 7.10% in May 2023. If it fails to break through the upper boundary of the ascending channel as Leshka analyzed, May 2026 could also be categorized as a bearish close.

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