 ▲ Bitcoin (BTC) decline / AI-generated image |
As the price of Bitcoin (BTC) struggles to secure support, the technical indicator Bollinger Bands has strongly suggested the possibility of further declines, warning against premature buying before reaching $54,420.
According to cryptocurrency media outlet U.Today on February 28, Bitcoin has undergone a significant correction from its recent highs and entered a phase of heightened volatility. While some market participants view the current downturn as a buying opportunity, technical analysts recommend caution, noting that the lower Bollinger Band remains positioned at a lower level. It is difficult to definitively confirm a bottom until Bitcoin tests the $54,420 level.
Bollinger Bands determine their upper and lower ranges based on price volatility. On Bitcoin’s daily chart, the lower band is currently formed around $54,420. Until the price touches this lower band, selling pressure is likely to persist, indicating that additional downside room remains technically open. Analysts predict that unless the price uses the lower band as support and stages a rebound, capital flowing into the market could result only in temporary gains.
The assessment that “buying below $54,420 may be premature” aligns with the prevailing anxiety in the market. Although Bitcoin is consolidating in the mid-$60,000 range, rebounds without strong trading volume have often served as precursors to further sharp declines. Investors appear to be delaying staged purchases while closely watching Bollinger Bands expand downward rather than contract to compress volatility.
Other supplementary indicators, such as the Relative Strength Index (RSI), also suggest that Bitcoin has yet to reach a true oversold bottom. After a strong rally in the fourth quarter of 2024 and the first quarter of 2025, Bitcoin has entered a consolidation phase, and some analysts view the current correction as a necessary process for healthier long-term growth. However, if short-term support levels break down, the risk of panic selling toward the low $50,000 range remains.
As macroeconomic changes intersect with the market, the importance of technical indicators in the Bitcoin market is becoming more pronounced. The specific level of $54,420 is expected to act not merely as a price point but as a key support line capable of restoring market confidence. Investors are advised to closely monitor the movement of the Bollinger Bands and maintain a conservative approach until clear signals of a market bottom emerge.
Disclaimer: This article is for investment reference only and the publisher is not responsible for any investment losses incurred based on this information. The content should be interpreted solely for informational purposes.