Five-Wave Downtrend Structure Activated, Impulsive Decline May Accelerate

Summary:

Bitcoin is currently trading around 71,900. The technical structure suggests that price may have entered the fourth wave correction within an Elliott five-wave decline. Short-term rebound momentum remains limited, with an overall bearish bias, and the market may be approaching an accelerated downside phase.

SELL BTC-USDT

Close Time

CLOSED

72202.1

Entry Price

38200.0

85000.0

62608.0 -1893.9 -2.94%

8161.9

Pips

Loss

38200.0

80364.0

Exit Price

72202.1

Entry Price

85000.0

Fundamentals

The overall sentiment in the crypto market has turned increasingly cautious. Following a period of consolidation at elevated levels, Bitcoin has failed to sustain upward momentum, while risk appetite has started to decline. Coupled with expectations of marginal tightening in global liquidity, the market is gradually shifting from “trend-following longs” to a more defensive stance at higher levels.

Although the medium- to long-term narrative has not been fully invalidated, short-term price action is now dominated by technical structures, showing clear signs of cyclical weakness.

Five-Wave Downtrend Structure Activated, Impulsive Decline May Accelerate_1

Technical Analysis

From an Elliott Wave perspective, Bitcoin currently aligns with a five-wave impulsive decline model:

Wave 1: Sharp drop from the top, initial bearish breakout below neckline

Wave 2: Weak corrective rebound, failed to make a new high

Wave 3: Currently unfolding with a steady decline

Wave 4: Ongoing weak corrective rebound, still below prior highs.This suggests the market may be transitioning into the early stage of a broader downtrend.

At present, price action exhibits typical mid-to-late stage bearish characteristics:Lower rebound highs,Consistently declining peaks,Ongoing battle around the key psychological level of 70,000.This indicates a transition from range-bound trading to a trending market.

On the other hand, if price effectively tests and breaks above 80,518, the five-wave bearish structure would be invalidated, and the market could shift back into consolidation or even resume an uptrend.

Overall, Bitcoin is highly likely in the early phase of a third wave within a five-wave decline, with market dynamics shifting from consolidation to directional downside.

Trading Strategy

Direction: Sell

Entry: 73,650

Target: 38,200

Stop Loss: 85,000

Valid Until: 2026-05-09 23:55

Support Levels: 64,970 / 62,589 / 59,928

Resistance Levels: 74,215 / 76,036 / 79,257

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