As fast as the odds of the bounce increased yesterday, they faltered right away after Bitcoin retraced below 31 411.48 USD. After that, Bitcoin erased most of its prior gains and halted a decline at 29 184.25 USD. Currently, it trades near the 26 600 USD price tag. We maintain our bearish stance and price target of 25 000 USD.
The market sentiment and fundamental factors The retail sector exhibits exuberant bullishness as we continue to see an immense attempt of lay traders to call a bottom in the market. That suggests we have not seen a capitulation yet. Additionally, all this continues to occur despite persistent bearish fundamental factors like higher interest rates in the U.S. and economic tightening. Meanwhile, other problems for the cryptocurrency market also start to mount. The recent fallout with the Luna token will lead to stricter regulations in the cryptocurrency market, which will see many cryptocurrency projects disappear in the future. Further, the SEC launched a probe into Binance over its BNB token, which raises more uncertainty in an already uncertain market. These are just a few factors that we consider to support our bearish thesis.
Illustration 1.01 The picture shows BTCUSD gaining market dominance since the start of 2022. That suggests that many smaller altcoins are left behind, and money flows into Bitcoin.
Technical analysis - daily time frame RSI is bearish. MACD and Stochastic are neutral. DM+ and DM- performed bearish crossover. Overall, the daily time frame is bearish.
Illustration 1.02 Illustration 1.02 shows the hourly chart and simple support/resistance levels.
Technical analysis - weekly time frame RSI, MACD, Stochastic, DM+, and DM- are all bearish. Overall, the weekly time frame is bearish.
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not serve as a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
@jdo85, I agree this rally is going to catch everyone by surprise. The DXY on the monthly is in a triple top formation and I did a chart showing that we will probably see a nice dive down to 92 or so over the next year and a half. This drop will be initiated by more stimulus and QE, they cant stop printing now or the whole house of cards will collapse. The economy will completely crap the bed if they stop printing money now, and they don't want that. Expect some type of news to come out as a reason/excuse to stop the rate hike and drop rates again and to print more money, its coming. I will leave my chart below and you can see for yourself the DXY is topped out for now. RSI is also showing a fresh curl down after hitting overbought territory. The fractal I show is just one of many as well. I see 200k + BTC in a short period of time. Good luck out there