Bitcoin Still Showing Sell Signals as Analysts Debate Whether Another Drop

Bitcoin is fighting to recover after one of its most difficult trading weeks in recent months, yet market signals continue to point toward caution. The world’s largest cryptocurrency is trading above $86,800, showing mild progress over the last 24 hours, but weekly indicators still reveal sustained selling pressure that has not completely disappeared from the market.

Over the past week, Bitcoin has lost 8.7%, falling from near $95,000 to roughly $80,000 before bouncing slightly. Despite this rebound, traders remain unsure whether the recovery will continue or if another leg downward could appear soon. The broader performance picture shows that Bitcoin is still down 18.2% over the past two weeks and 22% over the past month, meaning confidence among many traders remains fragile.

Even with this weakness, Bitcoin’s market cap stands around $1.73 trillion, rising modestly by 1.31% in the last 24 hours, showing that some dip buying is taking place. Still, the main question continues to be whether this momentum is truly sustainable.

Weekly Chart Shifts to a Sell Signal

Technical analysts are pointing toward a key development in the weekly timeframe: the appearance of a sell signal on the Supertrend indicator. This shift occurred near $116,600, and Bitcoin now trades far below this level. As a result, a zone that previously acted as strong support has turned into resistance.

This transition usually suggests that the bullish control seen throughout 2024 and early 2025 has weakened on the high timeframe. Traders who had positioned for an uninterrupted rally now face a more cautious environment where rebounds could run into heavy resistance.

Historically, when Bitcoin trades far below the Supertrend line, a recovery toward overhead resistance takes time. Analysts note that any move toward $95,000–$100,000 may encounter selling pressure from traders who want to exit at break-even or from institutional sellers rebalancing positions.

Momentum Flips Negative as Sellers Dominate

Momentum readings also confirm the technical shift. The Chande Momentum Oscillator (9-period) has dropped sharply to around −42.5, entering deep negative territory after spending most of the prior rally above zero. The shift from positive momentum to negative momentum usually highlights an early transition from accumulation to distribution — meaning selling pressure outweighs buying pressure.

Momentum indicators in this zone do not guarantee another sharp decline, but they illustrate that buyers have not yet regained meaningful control. Analysts warn that, in the short term, Bitcoin remains vulnerable to renewed selling if support levels are tested again.

Short-Term Rally Still Possible

Even though the broader weekly structure points toward caution, not every chart is bearish. On the lower timeframe, Bitcoin is trading below a downward-sloping resistance trendline, creating a pattern of lower highs. For bulls, reclaiming this trendline would be a meaningful signal of early recovery.

One market strategist, known as Captain Faibik, believes that if buyers take control and push Bitcoin above this resistance line, the cryptocurrency could rally between 10% and 12%. That would place Bitcoin near $96,500, bringing it back into the zone where the breakdown originally accelerated.

However, this potential recovery depends on a clear technical breakout. Without it, analysts argue that sideways choppiness or another decline remains on the table.

Market Psychology Plays a Critical Role

Traders remain divided on the path ahead:

• Short-term traders see room for volatility and opportunities for quick trades on both sides of the market.

• Long-term holders appear more cautious but have largely continued accumulating rather than selling.

• Leverage traders, who contributed to recent liquidations, are dialing back aggressive positioning.

A large portion of Bitcoin’s recent decline was driven by the unwinding of highly leveraged long positions, combined with macro uncertainty and profit taking. Traders are now watching whether the market stabilizes as leverage resets or whether macro pressure continues to weigh on risk assets.

Is Bitcoin Closer to a Bottom or a Deeper Drop?

There are convincing arguments on both sides.

Bearish side:

• Weekly sell signal remains intact

• Momentum sharply negative

• Resistance overhead near $95K–$100K

• Market still nervous after major liquidations

Bullish side:

• Buyers defending $80K support

• Short-term rebound already underway

• Selling pressure appears to be slowing

• Long-term fundamentals continue to attract institutional capital

As a result, the market has reached a phase where emotions and positioning are nearly equal in influence. If selling continues, the next leg downward could come quickly. But if buyers regain control by reclaiming major resistance levels, the recovery could surprise many traders who currently remain cautious.

Final Outlook

Bitcoin’s current structure reflects a battle between weakening momentum and gradual bottom formation. The market clearly exited its prior parabolic trend, but it has not yet entered full breakdown territory. The next defining move will likely depend on how Bitcoin behaves around the key resistance trendline in the short term and the $80,000 support area in the medium term.

For now, Bitcoin traders are monitoring charts more closely than ever — not because of panic, but because the market is sitting at a point where either outcome is still possible.

Whether the next major move is up or down, the decision zone is approaching.