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▲ Bitcoin (BTC), decline, bear market/AI-generated image
As Bitcoin (BTC) gave up the $80,000 mark, analyst Rei Researcher diagnosed the current price structure as one of the most sensitive sections in this entire cycle.
According to Bitcoinist on May 20 (local time), the price of Bitcoin has gone beyond a simple technical support breakdown and entered a specific intersection where holders' average purchase prices are concentrated. This is causing a structural conflict between forces trying to push the price up and those trying to block it. Based on CryptoQuant's holder indicator chart, Rei Researcher analyzed that Bitcoin showed a recovery to the average price zone of short-term holders after defending the April low. Short-term investors who endured losses during the previous downturn turned to selling once they reached their break-even price, forming a strong resistance wall.
On the other hand, there are also supporting factors that prevent this decline from being viewed as an unconditional bear market. Although Bitcoin has given up $80,000 and is trading around $77,000, it still remains higher than the average inflow price of institutional investors and the average acquisition cost of funds accumulated since the launch of Bitcoin spot ETFs. This zone acts as a key support line that institutional investors must defend to avoid unrealized losses. Rei Researcher warned that if the ETF average price support line breaks, investment sentiment will worsen, institutional capital outflow will accelerate, and it could transition from a sideways trend to a full-fledged downtrend.
Currently, Bitcoin is caught between the boundaries of the two most powerful forces. On the downside, the average price of institutions, the most structurally important new buying entity, provides support, while on the upside, selling pressure from short-term holders' average prices and the 200-day moving average are exerting downward pressure. On the weekly chart, Bitcoin failed to reclaim the key resistance zone of $78,000 to $80,000 and continues a sluggish trend around $76,700. This shows that the corrective downtrend structure that has persisted since hitting a high of $110,000 at the end of last year still dominates the market.
During the crash at the beginning of this year, buying pressure defended the demand zone between $64,000 and $68,000, leading to a recovery to the weekly 50-day moving average, but trading volume is insufficient to overcome the resistance zone around $80,000. The decrease in trading volume seen in the recent rebound market suggests a lack of aggressive spot buying, unlike previous bull markets. The mid-to-short-term trend in the future is expected to be determined not by a gradual movement, but by a decisive breakthrough that clearly pierces one of the average price zones. A clear upward break of $80,000 would restart upward momentum, but conversely, losing the $68,000 zone carries a high risk of the entire market undergoing a massive reset.
*Disclaimer: This article is for investment reference only and we are not responsible for any investment losses based on it. This content should be interpreted for informational purposes only.*
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