Bitcoin (BTC/USD) has faced headwinds over recent trading sessions. The largest cryptocurrency by market cap plunged roughly -10% this past weekend and has been struggling to regain altitude ever since. This selloff led to a breakdown of the bullish trend that guided Bitcoin higher throughout most of the year. The latest stretch of downside also pushed Bitcoin below its 50-day simple moving average, and this could leave BTC/USD price action vulnerable to further weakness.
In our last Bitcoin forecast, we highlighted potential for another breakout that would likely face pushback from bearish divergence on the relative strength index, which came to fruition. Now, it looks like Bitcoin bears have wrestled back control of direction, but the bottom Bollinger Band has provided buoyancy to BTC/USD price action so far. Reclaiming the 50-day simple moving average could increase the odds of a rebound higher, but the negatively sloped 20-day simple moving average still lurks overhead. This brings to focus the $50,000-price level into focus as a more formidable area of technical support for Bitcoin, which is roughly underpinned by its 38.2% Fibonacci retracement and 100-day simple moving average.