Bitcoin managed to break above the resistance level above $21,000 and seems poised for further gains. The cryptocurrency records its first week in the green after relentless selling pressure pushed it to a multi-year low of around $17,000.
At the time of writing, Bitcoin (BTC) trades at $21,700 with a 5% and 12% profit in the last 24 hours and 7 days respectively.
BTC’s price trends to the downside on the 4-hour chart. Source:
Data from Material Indicators (MI) shows an increase in bid orders for BTC’s price as it moves to $22,000. The cryptocurrency records around $10 million in bid orders at $21,800 and $21,500 alone.
As seen below, these levels were previously unprotected and were susceptible to further downside. In lower timeframes, it seems as if investors have been forming a liquidity shield for BTC’s price at its current levels.
The data shows a slight decrease in the buying pressure, which could indicate BTC’s price will return to a consolidation phase. In order to sustain the bullish momentum, analysts from Material Indicators claimed BTC’s price must stay above $20,000 for the next two days.
BTC’s price (blue line) sees more support around $21,500 and $21,800 (bid orders in red). Source: Material Indicators
In order to extend the bullish momentum, the cryptocurrency must reclaim the 200 Weekly Moving Average (WMA) which stands at $22,560. Analyst Michaël Van de Poppe on potential price consolidation before any attempt to reclaim higher levels:
The crucial resistance for #Bitcoin as we speak. (Volume has to do with the fact that Binance has added the zero trading fees) Looking good overall but wouldn’t be surprised with some slight consolidation before a big breakout occurs.
What Could Get In The Way Of A Fresh Bitcoin Rally
According to economist Alex Krüger, the U.S. Federal Reserve (Fed) is still the most important headwind for BTC’s price. The financial institution has been trying to slow down inflation by hiking interest rates.
However, the Fed believes any potential negative impact from an interest rate hike or decreasing its balance sheet, Quantitative Tightening (QT), is already priced in. Thus, why the potential for future downside has been potentially reduced, Krüger :
Unless inflation surprises considerably to the upside, the Fed is fine with things as they are, and monetary policy tightening is mostly in the price. QT won’t destroy markets. Major moves require an information shock, which then leads to a shift in equilibrium.
The next major obstacle to BTC’s price could be the traditional companies’ earnings season. If stocks trade to the downside as a result of an economic slowdown, the already highly correlated crypto market could follow.
A literature major, Reynaldo Márquez has been deeply immersed in the crypto industry since 2017. His journey began with translating articles for various crypto news outlets, a role he took on with zeal. In 2018, amidst a challenging market, he embraced his first writing assignment, demonstrating his unwavering commitment to the nascent industry and the promise of change it bears for many people worldwide.
In March 2021, he joined the prestigious crypto news outlet NewsBTC and Bitcoinist, where he not only reported on the latest crypto news but also had the privilege of interviewing some of the industry's most influential figures. A year later, his dedication and hard work were recognized, and he was promoted to Managing Editor, a position he currently holds with pride.
He believes in honesty, good communication, hard work, and the power of cryptocurrency and its potential to transform people's lives, especially those alienated by the legacy financial system. Born in 1992 in Venezuela, Reynaldo is familiar with how governments and central banks can negatively affect people, their everyday lives, and their futures by creating inflation and erasing their hopes for a better future. Thus, like many Venezuelans, he embraced this new technology to help him and his family navigate difficult times.
In another life, Reynaldo would have pursued a career as an investigator, most likely tracking down the origins of the Cyberpunk movement with the publication of William Gibson’s ‘Neuromancer.’ The intersection between fiction and reality, with the materialization of Bitcoin in 2009, would have allowed him to dive deep into the crypto sphere as something more than a financial phenomenon but also a cultural shift in society that was brewing since the XX century, and maybe even sooner, in the XIX century with the publication of Henry David Thoreau’s ‘Civil Disobedience.’
But that’s for another life. In this one, Reynaldo has been trading to improve his trading skills. Since 2023, he has been trying to learn Python to create successful strategies and find ways to execute them. It is a difficult task, which continues to keep him busy today and will most likely continue to keep him busy in the near and long term.
In his free time, he enjoys lifting heavy objects, reading, watching movies, and listening to his favorite music. Some of his favorite authors are Walt Whitman, William Faulkner, Allen Ginsberg, James Baldwin, Raymond Carver, Ray Bradbury, George Orwell, Mario Vargas Llosa, Reinaldo Arenas, Rafael Cadenas, and many others. Lately, he has been primarily interested in reading about dystopic societies, a topic that deeply resonates with the crypto industry.
Since 2023, he has lived in Spain with his wife. He loves the weather, the food, and the people and their culture. They both expect to travel much more within the country they now call home and beyond its border. He hopes to retire with his wife, maybe in a quiet place near a beach, but most likely in a city close to a library and a university with his kids and, hopefully, grandkids.
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