- Bitcoin is testing EMA 200 as it hovers near the Fibonacci retracement 0.5 at $79,730.
- A bullish divergence is forming as Bitcoin reaches oversold conditions on 1-day charts.
- Traders are waiting to see if Bitcoin will rebound or drop toward the $72,575 support.
Bitcoin’s price action has reached a critical juncture as it hovers around the 200-day Exponential Moving Average (EMA 200), which is usually an important support level that has often dictated bullish and bearish momentum. According to analyst Stockmoney Lizards, BTC is testing this level at approximately $79,493, aligning precisely with the 0.5 Fibonacci retracement at $79,730. This combination of technical indicators suggests a potential inflection point, with traders closely watching whether Bitcoin holds this level or breaks lower toward the 0.618 Fibonacci level at $72,575.
Source: X
CME Gap Partially Filled, Strengthening Technical Case
The recent downward move has also filled up a Chicago Mercantile Exchange (CME) futures gap, a phenomenon commonly followed by price stabilization or reversal. When keenly observed, the retracement at 38.2% ($86,890) had acted as intermediary resistance, which failed to sustain the buying pressure. The current test of the 50% retracement zone, coupled with oversold conditions on the 1-day chart, has fueled speculation about an impending bounce, especially with a bullish divergence emerging on the 4-hour timeframe.
A look at Bitcoin’s trajectory shows the importance of EMA 200. Historically, BTC has rebounded from this moving average during bull market consolidations, and its failure to hold has signaled deeper corrections. Any decisive breakout could dictate short-term market sentiment, with price action now compressed between $79,000 and $82,120. A failure to maintain this range could trigger a move toward $72,575, while a recovery above the $86,890 level would put Bitcoin back on track for further gains.
Related: Is Bitcoin (BTC) Heading for a Massive Crash Again in 2025?
Market Awaits Bitcoin’s Reaction to Key Levels
The market’s next move hinges on whether the token can maintain its grip on EMA 200 and defend the 0.5 Fibonacci retracement. As liquidity thins and factors weigh in, the token’s reaction to this level could set the tone for its next big move.
