Bitcoin’s price trends have been volatile, with traders debating if a recent bullish EMA breakout signals a genuine upturn or just a bear market rally. Key economic reports indicate US GDP shrank by 0.3%, impacting market outlook. Despite short-term sell-offs, mid-term projections remain optimistic for Bitcoin, potentially pushing its price to between $130k and $140k in the coming months.
Bitcoin experienced a fluctuating week, as a bullish EMA breakout propelled momentum indicators to heights not seen since last December. Still, traders are left wondering if this surge indicates a bear market rally or perhaps the start of something more bullish, given lingering macroeconomic challenges. The uncertainty grows in light of a recent report showing a 0.3% contraction in the US gross domestic product (GDP) for Q1 2025 compared to last year.
President Trump attributed this economic downturn to what he calls the “Biden overhang,” linking it to the previous administration’s policies rather than his own actions, such as increasing tariffs. This negative GDP growth weighs heavily on the market’s prospects, prompting the Federal Reserve to reconsider whether their focus should be on curbing inflation or promoting economic growth.
The initial market response to the GDP report was a downward trend, with cryptocurrencies, including Bitcoin, seeing sell-offs following the American session’s onset. In just 24 hours, around $270 million in cryptocurrency long positions were liquidated, with Bitcoin and Ethereum accounting for approximately $115 million of that total. As buyers began to retreat, BTC’s long-short ratio began dropping significantly; dipping from 1.16 to 0.88 in just three hours, indicating a strong sell-off.
Surprisingly, in the light of these developments, that same metric rebounded to 1.275, suggesting that some traders are now opting for a more bullish outlook. As this plays out, Bitcoin is facing resistance at a substantial order block around the $97,000 mark, which it has hit several times only to face rejection. The trading volume at this price zone has been robust throughout the year, making it critical for both market behaviour and Bitcoin’s short-term trajectory.
Should Bitcoin retreat from this resistance, it may slip back towards the 21-day EMA, currently resting at about $89,900. A move below $90,000 appears plausible if the current trend persists. Moreover, momentum indicators show some fatigue as the Relative Strength Index (RSI) teeters on overbought territory and the MACD histogram has been declining for five consecutive days. On the brighter side, the mid-term outlook for Bitcoin is relatively optimistic, given a recent bullish crossover between the 21-day EMA and the 200-day EMA.
Historically, the last two instances of such crossovers led to new all-time highs within a three to six month period. If BTC does pull back, this could provide a solid buying opportunity. The question then becomes: how high can it possibly go this time? During previous price rallies, Bitcoin gained around 66%, which is significantly less than earlier gains made when it surged from $25,000 to $67,000.
As the market cap of Bitcoin expands, achieving similar rallies has become progressively tougher. Estimates suggest that a 30% to 40% increase could be within reach, placing Bitcoin’s price between $130,000 and $140,000 over the next three to six months. Remaining vigilant for technical indicators will prove crucial for traders eyeing potential profit in this fluctuating landscape.
Alejandro Arrieche, a journalist focused on financial analysis and market trends, has a deep understanding of both technical and fundamental aspects of investing and trading.
