Bitcoin is attempting to extend its recovery after rebounding sharply from June lows. The asset is now heading towards an important confluence of resistance, where a descending trendline aligns with a major supply zone.
While buyers have regained short-term momentum, upcoming sessions will determine whether this move turns into a broader trend reversal or another lower high within the dominant structure.
Bitcoin price analysis: the daily chart
On the daily time frame, BTC continues to trade below its long-term moving averages, with the 100-day MA positioned around the $70,000 region and the 200-day MA closer to $73,000. Both averages remain down, indicating that the broader market structure continues to favor sellers despite the recent rally.
After the sharp decline towards the $57,000-$60,000 support zone, Bitcoin established a streak of higher lows in a narrowing descending channel. The recent rally pushed the price towards the upper boundary of this formation, which coincides with the $66,000 to $67,000 resistance zone.
A decisive break above the descending trendline and $66,000-$67,000 supply zone would represent the first significant structural improvement since the correction began. Such a move could expose the next resistance level around $74,000, where the 200-day moving average and another major supply zone converge.
However, rejection of current levels would strengthen the descending structure and could trigger another pullback towards the $60,000 support region. Below this, the main demand zone around $55,000 remains the most important time support visible on the chart.
BTC/USDT 4-hour chart
The 4-hour chart presents a more constructive picture. Bitcoin has been respecting a well-defined descending channel since early June, but recent price action shows buyers are gradually reclaiming higher support levels after defending the channel’s lower boundary around $58,000.
The market has already broken through several intermediate resistance zones at around $58,000 and $61,000 before advancing towards the current resistance group around $66,000. This area also aligns with the upper trendline of the channel, making it the main battleground in the near term.
Unlike previous tests, the latest advance was accompanied by stronger momentum, with the RSI pushing towards overbought territory near 70. This reflects increasing buying pressure, but also raises the possibility of a near-term pause or local pullback if profit-taking emerges at the resistance level.
If the break above the channel holds, it could invalidate the current bearish corrective structure and pave the way for an advance to the next higher resistance around $72,000 to $74,000.
Conversely, failure to break above this ceiling would likely keep Bitcoin oscillating inside the channel, with initial support located near $61,000, followed by a stronger demand region around $58,000.
On-Chain Analysis
Bitcoin’s net unrealized profit/loss (NUPL) measure currently sits around 0.18, well below the euphoric levels seen during previous market peaks.
NUPL measures all unrealized profits and losses across the entire network. High values generally indicate widespread investor optimism and increasing risk of profit-taking, while lower values suggest that market participants are holding significantly lower unrealized gains.
NUPL’s recent recovery from deeply depressed levels indicates that the profitability of the entire network is gradually improving alongside prices. However, the indicator remains firmly in the lower sentiment bands and is still far from the overheated conditions that historically accompany cycle highs.
This suggests that, from an on-chain perspective, the market has not yet entered a phase of excessive profit-taking. If Bitcoin manages to break through its current technical resistance, continued improvement in NUPL would likely support a healthier and more sustainable recovery. On the other hand, a rejection at current levels could temporarily stall the indicator’s recovery without necessarily invalidating the broader rebuilding process.
LIMITED OFFER for CryptoPotato readers at Bybit: Use this link to sign up and open a FREE $500 position on any coin!
Disclaimer: Information found on CryptoPotato is that of the cited authors. It does not represent the opinions of CryptoPotato on whether to buy, sell or hold any investments. You are advised to carry out your own research before making any investment decision. Use the information provided at your own risk. See Disclaimer for more information.
