After the approval of the first BTC ETF, the price of BTC went through higher volatility for the second week in a row, in a quest for the price equilibrium. On one side there is a huge amount of speculative money which entered into BTC market in a quest for a short term profits, while on the other side are existing investors who previously had exposure toward the BTC through BTC-linked ETFs or mutual funds and other derivative products, who are now transferring their funds between crypto and traditional markets. In addition to that, it should be considered that relatively good US economic data are dragging investors' funds back to equity markets. Although several analysts were predicting the skyrocketing of the BTC price after the ETF approval, it did not happen. Bitcoin is entering into the mainstream, where its availability will drag more and more funds, and where it will be hard to move its price to either side, without an influx of huge amounts of money. With this in mind, the price of BTC should sustain at higher levels, at least by economic theory, but it should not be expected that volatility from the previous period will be repeated in the future. Of course, this course of action relates to normal market conditions. Fragility of the coin to negative fundamentals still exists.
Previous week BTC started by testing the $40K support line. Soon, this line was breached to the downside, and BTC swiftly reached its weekly lowest level at $38.550. This was the level when buying orders started to emerge, and BTC`s price reverted back toward the $40K resistance, ending the week modestly below the $42K. The RSI was quite close to the oversold market side, but it reverted back toward the level of 48, where it is ending the week. The level of 50 still has not been reached, which puts in question whether the market is ready to start looking at the overbought market side. At the same time moving average of 50 days slowed down its divergence from MA200, but is also still not ready to start a convergence move. The cross is still not near.
Based on current charts, it seems that testing of the $40K support line is still not over. There is a high probability that this level will be tested for one more time in the week ahead. There is also an equal probability that the market might continue the trend from the end of the previous week and move toward the short-term stop at $43K. The current level of $ 42K is not at all significant one for BTC, in which manner the current price is somewhere on the half of the road. Current charts are not showing the potential for the breach of the $43K level.
Previous week BTC started by testing the $40K support line. Soon, this line was breached to the downside, and BTC swiftly reached its weekly lowest level at $38.550. This was the level when buying orders started to emerge, and BTC`s price reverted back toward the $40K resistance, ending the week modestly below the $42K. The RSI was quite close to the oversold market side, but it reverted back toward the level of 48, where it is ending the week. The level of 50 still has not been reached, which puts in question whether the market is ready to start looking at the overbought market side. At the same time moving average of 50 days slowed down its divergence from MA200, but is also still not ready to start a convergence move. The cross is still not near.
Based on current charts, it seems that testing of the $40K support line is still not over. There is a high probability that this level will be tested for one more time in the week ahead. There is also an equal probability that the market might continue the trend from the end of the previous week and move toward the short-term stop at $43K. The current level of $ 42K is not at all significant one for BTC, in which manner the current price is somewhere on the half of the road. Current charts are not showing the potential for the breach of the $43K level.
