- The $2.5T support level is crucial for maintaining bullish structure amid weakening momentum and forming double-top signals.
- Persistent RSI bearish divergence since 2021 highlights fading bullish strength despite higher market cap peaks and volume stagnation.
- If $2.5T breaks with volume, the total crypto market cap could face a sharp $1 trillion correction toward the $1.2T–$1.6T zone.
According to crypto Patel, the total crypto market cap is threatening a $1 trillion drawdown if support breaks. At $2.5 trillion, this level now acts as the market’s lifeline. If bulls defend it successfully, the structure remains intact. However, a breakdown backed by volume could trigger a sharp correction. Currently, the market shows weakening momentum with several red flags forming on key indicators. Traders must stay alert and prepare for all possible outcomes in the coming weeks.
Bearish Divergence and RSI Breakdown
Since 2020, the market witnessed explosive growth, peaking in early 2021. Following that surge, bearish divergence emerged on the RSI. Despite higher price highs, RSI showed lower peaks, signaling fading bullish strength. The market corrected and tested a long-standing support between $1.2T and $1.6T several times through 2021 to 2023. Each time, buyers stepped in, confirming strong demand in that zone.
By early 2024, the market surged again, crossing $3T. However, RSI continued to trend lower, confirming weakening momentum. Consequently, this formed another bearish divergence that has yet to resolve. A new double-top structure may be forming as price hovers near $2.5T support. If this pattern confirms, bears could take control swiftly.
Consolidation Near Critical Support
The recent correction in early 2025 brought the market back to the $2.5T region. This level aligns with the 200-week EMA and previous bounce zones. Moreover, the RSI remains below 50 and continues to trend lower. This reflects growing selling pressure and a lack of bullish conviction.
Besides that, volume remains flat, signaling cautious market participation. A decisive move either way could shape the market’s next major trend. A recovery from this point would reaffirm bullish structure. However, a breakdown could lead to a retest of the $1.2T–$1.6T green support zone once again.
Additionally, the long-term RSI downtrend from 2021 stays unbroken, further weighing on the bullish narrative. Hence, this is not the time for complacency. While the structure hasn’t broken yet, risks are rising.
