Main Points:
- Bitcoin’s recent break below its rising trendline shifts the former resistance at $88,800 into a critical support level.
- A failure to hold above $88,800 could open the door to renewed downside, potentially retesting $75,000 and lower.
- On the hourly chart, Ichimoku Cloud signals confirm bearish momentum, though a reclaim of the cloud would invalidate the signal and renew bullish bias.
- XRP has lost its 50‑day SMA and is on the verge of a “death cross” as its 50‑day SMA threatens to dip below the 200‑day SMA.
- Historically, death crosses offer mixed predictive validity, underscoring the importance of risk management and confirmation from other indicators before assuming a sustained downtrend.
Bitcoin Trendline Break and the $88,800 Pivot
After trading within an ascending channel for much of April, Bitcoin (BTC) suffered a 1.5% drop on May 4, 2025 UTC, slicing through the trendline drawn from the April 9 low of $75,000 to the April 20 low, and confirming that the line of rising demand had finally given way . In classical technical analysis, once a well‑respected trendline is breached, the market often retests that line—now acting as resistance—before either resuming the former trend or accelerating the reversal.
In Bitcoin’s case, however, the broken trendline corresponds almost exactly with the $88,800 level, which had previously capped rallies on March 24 and April 2. With the line now acting as support, traders are watching closely to see if BTC can hold above $88,800. A decisive break below here would likely attract a fresh wave of selling, potentially dragging prices back toward the April 9 low near $75,000, and perhaps into the $70,000s if momentum intensifies.
Ichimoku Cloud Confirms Bearish Momentum
On the 1‑hour chart, price action has plunged below the Ichimoku Cloud—often interpreted as a proxy for momentum and short‑term trend direction. A break below the cloud suggests bearish control; conversely, a rally back above it would signal renewed bullish strength and open the path toward the psychologically significant $100,000 mark .
However, traders should note that the Ichimoku Cloud’s signals can lag during sharp moves, and false breaks remain possible, especially around key round numbers where stops and algorithmic orders cluster.
Potential Downside Targets
If Bitcoin loses $88,800, the next logical support is the April 9 low at $75,000. Below that, the April 2 low around $74,500 and the psychological $70,000 round figure could act as magnets for selling pressure. Fundamental catalysts—such as shifts in U.S. interest rate policy, ETF approval news, or macroeconomic surprises—could either exacerbate or mitigate these moves. Risk‑averse traders may wish to scale out of longs near $88,800 and redeploy at firmer levels, while contrarian buyers could look for oversold indications (e.g., RSI below 30) near long‑term trend support.
XRP’s Impending Death Cross
XRP’s chart paints a contrasting picture of weakening recovery momentum. After bouncing off the April 7 low, XRP rallied into its 50‑day simple moving average (SMA) but recently dipped back below it. More ominously, the 50‑day SMA is curving toward the 200‑day SMA, setting up the classic “death cross” pattern—long considered a bearish harbinger when a shorter‑term moving average crosses below a longer‑term one .
Mixed Track Record of Death Crosses
Yet, historical studies in both traditional equities and crypto markets reveal that death crosses often coincide with already‑decelerating markets, providing limited advance warning. Following the pattern’s confirmation, some assets have suffered extended drawdowns, while others have rebounded swiftly, catching late‑bearish traders off guard. Therefore, prudent traders should wait for additional confirmation—such as breakdowns below key support or volume spikes—before fully committing to short positions on XRP.
Broader Market Context and Recent Developments
- Institutional Flows and ETF Rumors: Ongoing speculation about additional Bitcoin spot ETF approvals in the United States has injected bouts of volatility. Positive ETF headlines tend to spark rapid upside, while delays or regulatory pushback can trigger swift retracements back toward trendline supports .
- On‑Chain Metrics: Network data show a slight uptick in realized volatility and marginally rising exchange inflows, hinting at increased selling intent among short‑term holders. Conversely, long‑term holder supply continues to dwindle, suggesting they remain confident in Bitcoin’s multi‑year thesis .
- Macro Backdrop: With U.S. CPI data due later this week and Fed commentary expected, macro traders are bracing for directional moves. Higher‑than‑expected inflation readings could revive hawkish bets, pressuring risk assets like crypto, whereas softer data may deliver relief rallies.
- Altcoin Rotation: Ethereum and select altcoins (e.g., Solana, Avalanche) have begun outperforming Bitcoin on days when BTC dips but fails to breach key supports. This rotation may signal that speculative capital is hunting higher‑beta plays, potentially limiting Bitcoin’s downside as buyers seek opportunities elsewhere.
Trading and Risk Management Implications
- For Bitcoin Bulls: Holding above $88,800 is essential to maintain the short‑term uptrend. A reclaim and close above the Ichimoku Cloud on the hourly chart would increase odds of a rally toward $95,000–$100,000.
- For Bitcoin Bears: A close below $88,800 opens the door to $75,000 and lower. Momentum traders may look to short bounces up to freshly broken supports, with tight stops above the trendline.
- For XRP Traders: Wait for a confirmed death cross (50‑day SMA crossing below 200‑day SMA) and a breakdown below recent swing lows before initiating new shorts. Use supportive indicators—like volume and RSI—to confirm trend continuation.
- Position Sizing and Stops: Given the heightened volatility around macro news, small position sizes and stop‑loss orders are advisable. Traders could place stops just beyond key moving averages or trendline retests to avoid being shaken out by whipsaws.
Conclusion
Bitcoin’s breach of its rising trendline and the shift of the $88,800 pivot from resistance to support mark a critical juncture. Holding this level is paramount for bulls seeking a return toward $100,000, while a failure could expose significant downside toward the $75,000–$70,000 zone. Meanwhile, XRP’s slide below its 50‑day SMA and looming death cross warrant caution, with mixed historical performance underscoring the need for confirmation from supplementary indicators. Against a backdrop of ETF speculation, on‑chain signals, and looming macro releases, disciplined risk management remains the key to navigating the choppy waters of crypto markets.
