The crypto market has been dead for the past few days. After a severe correction in recent weeks, Bitcoin is stagnating in a range around $20,000. So what next for the king of the asset market? Is a new pump possible in the next few days?
Repeated test of the $18,500 level
The last few weeks have been quite boring in the bitcoin market. The price oscillates in a range and after each gain there is a correction that destroys them in no time. From now June 13 and a red day that Bitcoin lost 15%, the latter is trading ia range between $17,600 and $25,000.
However, there is hope for some observers. Some actually think that a a bottom may have been found in the $18,500 area. In fact, in the last few days we notice that the the price has bounced several times in this area to get better afterwards. This level therefore acts for the time being as an effective support for Bitcoin.
If we extend our observation to a longer time scale, we notice that it was the situation was already at the beginning of July or else in the middle of September.
The price of Bitcoin in the last 3 months with this major support around $18,500 (source: Tradingview.com)
Furthermore, apart from two rather violent wickets of $17,000 on June 17 and 18, the price never fell below this support. However, you have to be careful. In fact, we know that the more a support is tested the more likely it is to succeed.
Psychological level and importance
This level is also not far from $20,000 psychological. Buying pressure is strong and yes strongly protected for now. If we put ourselves on a monthly time scale, we also notice that this level corresponds to the peak of a previous bull run. It is therefore only a trivial price level. The loss of this support could lead to another big drop for Bitcoin.
So we notice a lot institutional investors especially buying Bitcoin heavily in this price range. Remember that this seems to indicate a lot if Bitcoin manages to regain its ATH at more than $68,000.
Recently, we have also noticed a strong exodus of BTC from exchanges. However, this type of movement is common bullish. In fact, it shows that they want to hodl rather than selling by investors.
Crypto-assets are a risky investment.
Bitcoin remains a victim of macroeconomic conditions
All these aspects, however, should not encourage us to lose sight of the general context. And the latter is complicated to say the least. Macroeconomic conditions remain severely degraded. In addition, this could last several months if we rely especially on the declarations of the FED and market analysts.
According to these, the rise in interest rates initiated by the FED continue to the half of the year 2023 at least. This pressure puts pressure on the stock markets down and after them the crypto market.
The S&P 500, which brings together the 500 largest American capitalists, is still known as the true barometer of the equity market. quite a positive week. In fact, it is in almost 4% increase from Monday and achieve performances that we had not seen since the beginning of September.
However, the medium-term trend is still clearly bearish. From 1er January, the US index is down more than 21%. In addition, many observers expect a new correction for the end of this year.
Sharp correction in the S&P 500 since the beginning of the year (source: tradingview.com)
Also, it is difficult to imagine Bitcoin extricating itself from the surrounding doldrums. Remember that even today the crypto market is highly correlated with traditional markets.
First Bitcoin will need to buy strength tokens. So it could go over $20,000 and be fixed permanently. Furthermore, if he succeeds in resuming his forward march, a major resistance in the $25,000 area.
The latter has already pushed the price down many times. So it could hinder BTC’s plans in the short or medium term.
To learn more about crypto vending machines, find our article here.
