Bitcoin (BTC) failed to sustain its recovery push, facing a firm rejection just below the $78,000 mark on May 21 as mounting institutional sell-offs and on-chain resistance halted the recent upward momentum. The cryptocurrency was last trading near $77,700, following a slide from a local high of over $78,000 earlier in the day.
The rejection occurred at a technically significant zone. On-chain analytics firm Glassnode identifies $78,100 as the "True Market Mean," a threshold indicating the average cost basis of holders. Failure to reclaim this level suggests most recent buyers are now holding positions at a loss, increasing the risk of further selling.
Data indicates that institutional flows are a primary driver of the weakness. U.S.-based spot Bitcoin exchange-traded products (ETFs) have recently turned into net sellers on a weekly basis, a sharp reversal from the strong inflows that powered the rally earlier in the year. Furthermore, selling pressure has consistently intensified during U.S. market hours, while the Coinbase Premium has remained negative, pointing to decreased demand from American investors, according to analysis from CryptoQuant.
The inability to break higher leaves Bitcoin vulnerable to a deeper correction, with traders now watching critical support levels. CryptoQuant has identified the $70,000 mark as the primary on-chain support target if selling pressure continues. The market is also bracing for macro-level volatility, with the upcoming Q1 earnings report from Nvidia being viewed as a key sentiment indicator for all risk assets, including crypto.
The broader technical outlook remains bearish. Bitcoin was previously rejected near its 200-day moving average around $82,000, a level that historically confirms the underlying trend. The price is currently hovering below the 50-day and 100-day exponential moving averages, with momentum indicators like the Relative Strength Index (RSI) drifting lower, reinforcing the view that buying pressure is weakening. A break below the immediate support around $76,700 could open the path for a retest of lower supports, including the $70,000 zone.
This article is for informational purposes only and does not constitute investment advice.
