Why The Bitcoin Price May Be Ready To Return To $20,000
21 Outubro 2022 - 11:27AM
NEWSBTC
The Bitcoin price managed to close yesterday’s daily candle above
critical support, giving bulls a fighting chance to prevent further
downside. However, today’s trading session has favored the bears,
with BTC moving below the $19,000 area. Related Reading: Flow
Rolls Out Blockchain Tools As Social Dominance, Coin Price Seen
Rising At the time of writing, Bitcoin stands at $18,900, with a 1%
loss in 24 hours and a 2.4% loss in one week. Other
cryptocurrencies in the crypto top 10 by market cap follow a
similar trend except for Cardano and Solana. These cryptocurrencies
are recording heavy losses across the board. Bitcoin Price
Takes Downside Liquidity Last week, the Bitcoin price negatively
reacted to the September Consumer Price Index (CPI) print published
by the U.S. government. This metric is one of the benchmarks for
inflation, and its September print hinted at higher levels.
In turn, the U.S. Federal Reserve (Fed) will tighten the monetary
conditions of global markets. This policy will continue to cap any
bullish momentum for Bitcoin and risk-on assets, including those in
legacy markets. This reaction to higher inflation, and a
hawkish Fed, led the Bitcoin price to revisit its yearly lows near
$17,600 as the September CPI print was published. The crash was
short-lived as BTC rebounded to the high area of $19,000s.
During the flash crash, many traders opened long positions while
BTC rebounded. These traders expected a higher move, and their
leverage positions left a lot of liquidity to the downside.
According to analyst Justin Bennett, the Bitcoin price is taking
that liquidity before resuming its bullish momentum. Bennett
pointed out that BTC is moving in a tight range between $18,600 and
around $19,800. The cryptocurrency might return to those levels
before attempting another break of critical resistance near the
$20,000 area. The analyst said the following while sharing the
chart below: This has been my plan for $BTC all week. It was
a combination of last Thursday’s long lower wick getting partially
filled + the liquidity gap at mid $18k + channel support. Bitcoin
Shows Signs Of Capitulation At the time of writing, the Bitcoin
price appears to follow this trajectory. The cryptocurrency is back
at its range and could be aiming for the top of the channel. On
higher timeframes, Bennett said that while $18,700 holds on the
daily chart, Bitcoin might be gathering momentum to push into the
central area in the $20,000 region before making a fresh leg
lower. Related Reading: Quant Gets Listed On Binance Futures
As Price Retests $170; What’s Next For QNT? Data from research firm
Santiment indicates that Bitcoin is showing signs of capitulation.
Many believe that over the past months, BTC holders capitulated en
masse, making this long period of consolidation a painful step in
gearing up the next move to the upside. 👋 Capitulation signs
have been popping up Friday, including transactions from addresses
trading out their assets while at a loss. #Bitcoin is seeing its
lowest ratio of loss vs. profit transactions in 4.5 months, and
#Ethereum is seeing historically lows. https://t.co/hbytGlCBJ7
pic.twitter.com/tsJcgqWyBh — Santiment (@santimentfeed) October 21,
2022
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