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May ends in red; what next Bitcoin traders?

2min Read

Bitcoin retraces to a key dynamic support level as a trendline resistance and $28k becomes a double obstacle for bulls.

Bitcoin traders can expect this as BTC ends May in red

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Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.

The U.S. overwhelmingly passed the recent debt ceiling deal, giving markets a breather. But Bitcoin’s [BTC] bearish sentiment persists after failing to flip bullish on the higher timeframe chart. It closed May in red, sustaining about 4% loss in monthly performance. 

Source: Source: Coin360

Despite the price pump seen last weekend, BTC recorded $11 million outflows in short-Bitcoin in the same period. The trend marks the sixth consecutive outflow totaling over $270 million, according to Coinshares’ Digital Asset Fund Flows Weekly report

While this underscores the prevailing negative sentiment, declining volumes were also worrying. 

BTC’s trendline resistance roadblock

Source: BTC/USDT on TradingView

BTC price action has been making lower highs after price rejection at $31k in mid-April. A trendline resistance (white) has become a key roadblock on the daily chart, preventing BTC from flipping to bullish.

A recent bullish breakout on 28 May faced rejection at the trendline resistance, setting BTC to retrace to the previous mid-range of $26.8k. Below the mid-range lies the 111-day MA (Moving Average) of $26.5k.

The 111-MA has checked three major drops so far. One in mid-March and two in May, making it a key dynamic support level. A breach below the MA and range low of $26.0k could offer sellers more upper hand, denting the bullish sentiment further. 

The two support levels to watch out for in such an extended plunge are $25k and $24k. 

Conversely, BTC could rebound at the mid-range, which aligns with $26.6k, a key support level in late March/April after the U.S. debt ceiling news. 

However, bulls must clear the trendline resistance roadblock to gain leverage. Northwards, resistance levels lay at $28.5k, $29.8k and $31k. 

CVD spot declines

Source: Coinalyze


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Towards the end of May, CVD (Cumulative Volume Delta) spot took a nosedive, declining steadily from 29 May to 1 June (as of press time). It reinforces the sellers’ leverage seen in the past few days. 

With the US debt ceiling out of the way, the focus now turns to the FOMC meeting in mid-June. In addition, the $28k level has been marked level by long-term BTC holders in profit and could remain a key obstacle for a while. 

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Saman Waris works as a News Editor at AMBCrypto. She has always been fascinated by how the tides of finance and technology shape communities across demographics. Cryptocurrencies are of particular interest to Saman, with much of her writing centered around understanding how ideas like Momentum and Greater Fool theories apply to altcoins, specifically, memecoins. A graduate in history, Saman worked the sports beat before diving into crypto. Prior to joining AMBCrypto 2 years ago, Saman was a News Editor at Sportskeeda. This was preceded by her stint as Editor-in-Chief at EssentiallySports.
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