On May 30, influenced by the escalation of Sino-U.S. trade tensions, Bitcoin's price plummeted to $104,600, falling 2.4% within 24 hours and triggering concern in the digital asset market.
This correction has caused BTC to break below the important support level of $106,000, triggering a series of automatic sell orders according to technical analysis and reigniting waves of volatility across the entire cryptocurrency market.
This plunge is due to increasing investor concerns about the deadlock in trade negotiations between Washington and Beijing. U.S. Treasury Secretary Scott Bancen acknowledged in an interview with Fox News that the current negotiations are 'in serious trouble' and may require direct intervention to achieve a breakthrough.
The market is reacting to political instability.
The negotiation deadlock has negatively impacted investor sentiment, spreading from traditional financial markets to the digital asset realm. Although both parties reached a temporary ceasefire agreement earlier this month, the lack of concrete progress since then has weakened confidence in a lasting solution.
Previously, after deciding to pause taxation for 90 days, global stock market indices improved. However, structural contradictions—especially those surrounding the China-driven economic model—remain unresolved. The latest adverse developments seem to have triggered a 'safe-haven' wave among Bitcoin investors, leading to an increasingly defensive sentiment.
Technical analysis confirms the downward trend.
Bitcoin has begun a new round of corrections, breaking through the important support area of $107,500. The downward trend has not stopped, and the price continues to fall below the $105,600 mark, then testing the next support level of $104,600.
The temporary bottom has been established at $104,604, marking the end of the short-term sell-off. From now on, the price is in a phase of accumulation and slight recovery, rebounding to the $106,000 area. However, demand remains weak as the price has failed to break through the 23.6% Fibonacci retracement level from the peak of $110,500 to the bottom of $104,604.
Currently, Bitcoin is hovering below the $107,000 mark and is below the 100-hour moving average, suggesting that the short-term trend remains bearish. On the positive side, the recent resistance level is in the $106,000 area.
The next key resistance area is around $107,000, with further declines to $107,500. Notably, a bearish trend line is forming in the 1-hour time frame for BTC/USD, intersecting with the resistance level of $107,550—aligning with the 50% Fibonacci retracement level of the recent correction.
If Bitcoin can stabilize above $107,500, it may trigger stronger recovery momentum.
Technically, Bitcoin is currently trading within a descending triangle pattern, with the potential to break through the target of $118,000. In the short time frame (1 hour), this pattern shows the price progressively compressing towards the support level, with a strong support area between $106,000 and $104,000, aligning with the daily 'order block' area (red box) where buying interest is high.
A signal reinforcing the bullish scenario is the apparent positive divergence between the price and the RSI indicator. While BTC prices are making new lows, the RSI is trending upward, indicating that bearish momentum is weakening and a bullish reversal is imminent.
The chart also shows a potential false breakout of the trend line at $107,000, which could eliminate liquidity before a strong recovery. If the price falls to the $106,000 - $104,000 range and then quickly rebounds, this would confirm a bullish divergence and trigger a breakout towards the target of $118,000.
Today's fear index is 60, still in a state of greed.
The correction has arrived, and the opportunity to get on board has also been provided. I have previously mentioned the position of $105,000 for Bitcoin; today it also touched this level. This is why I've been advising everyone to be cautious with short-term trades and only act when the good positions arise. If anyone jumped in due to FOMO earlier, they are now definitely in a trapped state. Better to wait for Ethereum to reach $2,500 before getting on board. The overall market structure remains good; as I said before, the market's rise or fall is now dictated by a statement from Trump, and the negative impact of tariffs is not significant at this point. A slight decline is harmless; the long-term trend still points upwards.
