Bitcoin (BTC) experienced a significant decline, with its price falling to $79,800 on Thursday. This dip followed resistance encountered at a crucial dynamic level, despite a surge in weekly spot Bitcoin exchange-traded fund (ETF) inflows crossing the $1 billion mark for the first time since January. Technical indicators suggest that this correction may be temporary, as analysts anticipate a potential rebound.
The cryptocurrency’s drop below the $80,000 threshold was marked by a bearish divergence visible in the relative strength index (RSI) on both hourly and four-hour charts. This type of divergence occurs when the asset makes higher price peaks while the RSI shows weakening momentum, indicating diminishing buying strength during a rally.
For Bitcoin to stabilize its short-term price actions, it needs to hold above the weekly open level of $78,500. Key technical support is identified between $76,000 and $78,000, a region that coincides with Bitcoin’s 200-day exponential moving average (EMA) and a daily fair value gap (FVG). If the price continues to decline, Bitcoin may test this FVG area before making an attempt to rise above its recent peak of $82,800. Fair value gaps represent zones where sharp price movements have occurred with minimal trading activity, often creating liquidity during market retracements.
Crypto trader Jelle pointed out that the “200-day MA/EMA cluster” is currently acting as a resistance barrier, while also marking the $78,000 level as a significant support area. He suggested that a retest of the 200-day moving average could enable Bitcoin to revisit higher price targets.
Another trader, Killa XBT, highlighted a deeper support zone within the $76,300 to $74,700 range should selling pressure persist. He emphasized the importance of defending the weekly open near $78,500 as a critical short-term metric for bullish traders.
In parallel to Bitcoin’s price movements, demand for spot Bitcoin ETFs has seen notable momentum this week, with net inflows reaching $1.05 billion—the strongest weekly figure since the third week of January. A positive close by the end of Friday could signal the largest weekly ETF inflow return in nearly four months.
Data from Swissblock indicates that the Bitcoin Risk Index has plunged back to near zero, with ETF net flows turning positive at approximately 3,000 BTC. Historically, elevated risk levels have been associated with ETF outflows and heightened market selling pressure.
The latest analysis suggests that resets into a low-risk zone often coincide with renewed accumulation patterns around major support clusters. Even when the Risk Index showed a slight uptick last week, leading to brief ETF selling, accumulation quickly resumed. This indicates that ETF demand is effectively absorbing selling pressure, reinforcing the notion of a potential flow-driven breakout in the market.
Amid these developments, Bitcoin’s market dominance has risen above 61%, raising questions about whether altcoins will follow suit in this bullish environment.
