Bitcoin price analysis: BTC/USD under pressure after a strong sell-off

BTC/USD has recovered from intraday losses, but the upside is limited.
A strong move above $7,800 to bring $8,000 back into focus.

Tanya Abrosimova Independent Analyst

Bitcoin is trying to claw back some ground after a sharp sell-off during late Wednesday hours. The first digital asset has returned to the range above $7,600 amid fresh buying interest located on the approach to $7,500. BTC/USD is down 3.5% in recent 24 hours and mostly unchanged since the beginning of the day, though the market is still dominated by bearish sentiments.

Bitcoin Pizza day celebrated each year on May 22, went mostly unnoticed as the community was busy discussing Craig Wright's attempts to secure the status of Bitcoin creator. Also, new technical issues on Binance upset the market and increased the downside pressure on BTC prices. Several Binance traders reported losses due to webpage lags.

Bitcoin's technical picture

On the intraday level, BTC/USD returned within 1-hour Bollinger Band. While the recovery has stalled, the Relative Strength Index (RSI) reversed from oversold territory and stayed flat in a neutral position, which means that the prices might continue consolidating at current levels for some time. Strong resistance is seen on approach to $7,800. It is created by a confluence of the Simple Moving Average (SMA) 200 and the middle line of Bollinger Bands on 1-hour chart. A sustainable move above this handle will bring $8,000 back into focus.

BTC/USD, 1-hour chart

On the downside, the local support comes at $7,550 (the lower boundary of the above-said Bollinger Band) and $7,500 with the intraday low located on approach. Once it is cleared, the sell-off is likely to gain traction with the next focus on $7,270 (the neckline of the double top pattern visible on the 1-day chart.