Bitcoin falls below $79,000 after failing to sustain rally above $81,000

Bitcoin fell below $79,000 on August 27 after a failed attempt to sustain momentum above $81,000, trading near $78,700 and down roughly 0.4% over 24 hours despite maintaining a seven-day gain close to 13.8%. The pullback began after Bitcoin reached an intraday high of $81,265 on August 25 and encountered its 50-week moving average near $81,085, placing the token below resistance extending towards the May swing high near $82,800.

The rapid rally that preceded the rejection had pushed Bitcoin up more than 23% in a week, fueled partly by a weaker US dollar and demand linked to currency debasement concerns, while also leaving traders holding substantial short-term profits. Much of the run-up came from forced buying in the derivatives market, as short liquidations occurred at scale. According to Glassnode data, the largest single-day Bitcoin short liquidation event in recent history preceded the pullback.

Bitcoin has since recovered from an intraday drop towards $77,600 but has struggled to reclaim $79,000. The article indicates that with the forced derivatives buying reversing, long positions now face liquidation pressure on dips, while momentum indicators show elevated readings suggesting potential near-term weakness. The $80,000 to $83,000 zone remains key resistance, with $75,000 identified as primary support.