empty
 
 

Forex Analysis & Reviews: Bitcoin continues its recovery movement and consolidates above $17k
time 05.12.2022 12:51 PM
time Relevance up to, 06.12.2022 10:48 AM

There was no significant decrease in trading activity over the weekend. Following the results of Saturday and Sunday, Bitcoin formed two equivalent candles, but the bulls had the final say. Having swallowed Saturday's fall with Sunday's growth, buyers developed an upward movement on Monday.

Bitcoin reached the $17.3k level, where it ran into the $17.3k–$17.6k important resistance level. The total increase in Bitcoin capitalization over the past seven days amounted to 6.8%, and over the past 24 hours, about 2%. The initiative is still on the side of the bulls and is supported by a fundamental positive.

This image is no longer relevant

The Fed's policy is gradually easing, and markets expect a key rate hike of only 50 basis points. Thanks to this and the proximity of the Christmas holidays, the stock market is growing, which is gradually resuming the correlation with BTC.

This image is no longer relevant

At the same time, the situation remains tense with mining companies that have suffered record losses over the past seven years. Despite this, most of the BTC volumes that end up on the market are absorbed by long-term investors. This can be seen from on-chain indicators, and the weakness of the bears in the current period of price movement.

Bitcoin and S&P 500

After the crash of FTX, the correlation between Bitcoin and stock indices was completely broken and reached the level of -0.52. Subsequently, the indicator began to recover, and by the end of last week it reached a level above 0.70.

After the weekend, when the US markets were closed, we again see a correlation. Given the lack of trading activity over the weekend, we should most likely expect an upward movement in the SPX and other stock indices.

This image is no longer relevant

However, do not forget that SPX and BTC strengthen the correlation during a downward trend. Given that Bitcoin has crept up to a difficult resistance level, there is reason to believe that it is the cryptocurrency that will repeat the local downward maneuver of the stock index.

BTC/USD Analysis

Bitcoin is in the final stages of breaking out of the $15.6k–$17.5k triangle. Having reached a local bottom on November 21, bullish activity followed, thanks to which Bitcoin maintains an upward direction for the third week in a row.

The asset is gradually approaching the monthly high, which is a strong resistance area. The cryptocurrency reached the $17,350 level, where it faced increased selling pressure. Up to $18.1k, Bitcoin will face increasing sales volumes.

This image is no longer relevant

This could provoke a local price pullback, and in order to maintain the upward potential of BTC, it is necessary to hold the $16.7k-$16.9k level . Otherwise, sellers will take advantage and send the price to retest $16.3k.

Technical metrics point to the continuation of bullish sentiment and the continuation of the upward movement of BTC/USD. The RSI remains bullish, but the stochastic oscillator has reached the overbought zone, which may indicate the need for a local pause.

This image is no longer relevant

The MACD indicator continues its upward movement towards the zero mark and approaches the green zone. This suggests that a possible bullish peak is yet to come. Given a certain overbought stochastic, we should expect a local price decline before continuing the upward movement.

Results

Technically, investors continue to actively buy the $15.5k bottom. In the coming days, it is important to monitor the dynamics of on-chain indicators of trading volumes and active addresses. If the indicators grow commensurately with the price increase, then this will be a signal of the strengthening of the bullish trend.

This image is no longer relevant

At the same time, it is important to understand that the fundamental background can play both for and against the upward movement. The market is sensitive to any macroeconomic events, as well as fluctuations in the stock market. Therefore, it is important to take into account the combination of technical and fundamental factors when actively trading BTC/USD.

Artem Petrenko,
Analytical expert of InstaForex
© 2007-2023
Mining
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Start trade
Start trade

InstaForex analytical reviews will make you fully aware of market trends! Being an InstaForex client, you are provided with a large number of free services for efficient trading.

Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST
  • Chancy Deposit
    Deposit your account with $3,000 and get $10000 more!
    In January we raffle $10000 within the Chancy Deposit campaign!
    Get a chance to win by depositing $3,000 to a trading account. Having fulfilled this condition, you become a campaign participant.
    JOIN CONTEST
  • Trade Wise, Win Device
    Top up your account with at least $500, sign up for the contest, and get a chance to win mobile devices.
    JOIN CONTEST
  • 100% Bonus
    Your unique opportunity to get a 100% bonus on your deposit
    GET BONUS
  • 55% Bonus
    Apply for a 55% bonus on your every deposit
    GET BONUS
  • 30% Bonus
    Receive a 30% bonus every time you top up your account
    GET BONUS

Recommended Stories

Ripple: upside scenario intact

Ripple retreated a little in the short term but the bias remains bullish in the short term. It's trading at 0.4084 at the time of writing and it seems determined

Ralph Shedler 18:43 2023-01-27 UTC+2

BTC update for January 27,.2023 - Potential for the upside breakout of the trading range

Technical analysis: BTC/USD has been trading sideways in the defined trading range and I see potential for the breakout play. Trading recommendation: There is potential for the breakout

Petar Jacimovic 09:38 2023-01-27 UTC+2

Technical Analysis of ETH/USD for January 27, 2023

Crypto Industry News: According to data from the Dune analytics platform, OpenSea processed over $320 million worth of NFTs on the Ethereum network in January 2023. This figure makes

Sebastian Seliga 08:36 2023-01-27 UTC+2

Technical Analysis of BTC/USD for January 27, 2023

Crypto Industry News: US Senator Elizabeth Warren praised the efforts of the national securities regulator and its chief Gary Gensler in overseeing the crypto industry. At the same time

Sebastian Seliga 08:35 2023-01-27 UTC+2

Technical Analysis of Intraday Price Movements of Ripple Cryptocurrency, Friday January 2023.

Although on its 4 hour chart stipp formed Golden Cross where this gives an indication that Buyers are still dominating but with the appearance of the Head and Shoulders pattern

Arief Makmur 07:37 2023-01-27 UTC+2

Technical Analysis of Intraday Price Movements of Polkadot Cryptocurrency, Friday January 2023.

If we look at the price movement of the Polkadot cryptocurrency on the 4-hour chart, it appears to be moving above the Moving Average, which confirms that in the near

Arief Makmur 07:37 2023-01-27 UTC+2

Bitcoin: upside scenario still valid

Bitcoin climbed as much as 23,815 yesterday where it has found resistance. Now, it's trading at 23,003 and is fighting hard to resume its growth. The bias remains bullish

Ralph Shedler 20:35 2023-01-26 UTC+2

Mike McGlone saw the emerging bullish trend.

On the 4-hour TF, it is evident that bitcoin is confidently moving to the level of $24,350. Remember that the expansion started with the release of the US inflation report

Paolo Greco 15:24 2023-01-26 UTC+2

Bitcoin did not have time to rise in price, as they rushed to sell it.

The price of one bitcoin coin has remained around $23,000. Since the price has not significantly altered over the past day, we can infer that the cryptocurrency is once again

Paolo Greco 15:18 2023-01-26 UTC+2

Bitcoin bulls should be cautious.

Bitcoin remains in a short-term bullish trend but traders need to be very cautious. The RSI continues for a second higher high in price not to follow and instead provide

Alexandros Yfantis 15:13 2023-01-26 UTC+2
Can't speak right now?
Ask your question in the chat.