Bitcoin entered uncertainty territory in the last week of March as a strong weekly close failed to reach $30,000.
While there has been some volatility between the two as the market looks for a new direction, the largest cryptocurrency has been largely flat for seven days in a row. where does it go next
In a week of more macro surprises, BTC/USD took a lot of time to react to the Federal Reserve (Fed) decision and related comments.
However, a period of relative calm followed, followed by a key monthly close that analysts say could start a new uptrend.
Bitcoin is up 20% so far in March, meaning the next few days will determine the strength of Bitcoin’s continued recovery from multi-year lows.
In the final week of a tumultuous month, here are five key themes to consider.
Countdown to Bitcoin Monthly Close
Bitcoin ended the week with a modest bounce back to the $28,000 mark, according to TradingView data.
BTC/USD 1-week chart. Source: TradingView
This means that BTC/USD is roughly flat compared to last weekend, providing impressive stability despite volatility during the outage.
However, there are concerns that the market may struggle to maintain current levels.
In a new analysis on March 27, popular Twitter account IncomeSharks flagged on-balance volume (OBV) as a clear sign of bearish momentum.
“It’s hard to ignore weak OBV at resistance, price at resistance and lack of demand at those prices. If price falls, a new wave of buying demand could drive prices higher. The only way BTC can go up from here is major market news Or another austerity.”
Source: IncomeSharks/Twitter
Trader and analyst Rekt Capital agrees that a “healthy” retracement is imminent for Bitcoin.
“If BTC continues to struggle to break above $28,700, then a healthy pullback may be needed to attract fresh buyer interest at lower levels. Technical indicators are showing some short-term weakness, and a catalyst may soon emerge to correct this weakness.”
Over the weekend, Rekt Capital flagged that price level as an important area to watch, while remaining bullish on the long-term trend.
He predicts that the BTC/USD pair will “confirm” a breakout from the bear market in late March, as long as the monthly close is supported by the 200-week moving average (WMA).
The 200WMA is currently around $25,500, creating a slight downside opportunity.
#bitcoin Has broken above the 200-week moving average
However, it has not technically been recycled as support
if $bitcoin If it falls soon, the price may try to retest the 200-week moving average as support
A successful retest there would fully confirm a break above the 200-week moving average#cryptocurrency #bitcoin https://t.co/RqdxRuAkwd pic.twitter.com/zdYjOHxwCE
— Rekt Capital (@rektcapital) March 26, 2023
Likewise, but on a shorter time frame, Trader Tony looked at the $27,700 and $26,600 levels.
“Bitcoin has yet to lose its $27,700 EQ on the 4-hour time frame, so doomsday tweets may pause,” he concluded, referring to the balance between capping buying and selling pressure.
“Losing the low $26,600 range is what I’m building a short hedge on for myself.”
Source: Tony/Twitter
Eye on PCE data as SVB gets acquired
Unlike last week, the last days of March are not expected to bring surprises in the US macroeconomic sector.
That’s not to say there won’t be volatility, but the rest of the month has been relatively quiet in terms of macro data releases.
Key macroeconomic events for the week ahead:
️ Thursday 30 (UTC)
12:30 — U.S. gross domestic product (GDP)
12:30 — U.S. jobless claims• GDP expected to remain at 2.7%
• Projected jobless claims rise to 196K from 191K🗓️ Friday the 31st (UTC)
12:30 — 🇺🇸 US PCE Core…– Lambda (@lambdamarkets1) March 26, 2023
An important exception may be the US Personal Consumption Expenditures (PCE) release on March 31, which provides important insight into US inflation trends.
Market commentator Tedtalksmacro commented:
“US PCE inflation data is due this week – last month’s data sparked volatility, weighing on risk asset prices. However, core PCE is expected to cool to +4.4% YoY this month from +4.7% previously. That’s It will be very positive.”
If Bitcoin reacts more than expected to the PCE data, the result could be a volatile weekend.
Any new developments in the ongoing banking crisis would add to the uncertainty, and the risk is there – contagion is still raging in Europe, and Silicon Valley Bank (SVB) is no more. A buyer has been found.
However, after raising rates during the crisis, the Fed took a slanted path on interest rates – it signaled the possibility of further hikes, while the market took the opposite view due to pressure from previous hikes.
“Tighter financial conditions and continued signs of stress in the banking sector are the main reasons why the market believes the Fed will be forced to abandon its plans to raise interest rates,” the analyst platform said, explaining Mosaic Asset.
Mosaic further warned that risk assets have historically underperformed in the immediate aftermath of policy rate hikes.
“If the Fed pauses in rate hikes, it would signal growing concern that the central bank is disrupting capital markets. But also consider the Fed’s record of only adjusting policy when it’s too late.”
“So, in previous bear markets, the biggest stock market losses have occurred after the Fed paused or cut rates outright.”
Hodler BTC Is Causing a Supply Shock
Bitcoin holders are setting new records under current conditions — and setting the stage for a supply shock in the process.
New data from on-chain analytics firm Glassnode shows that the available supply of BTC that hasn’t left wallets in around two years is now at an all-time high.
As of March 27, over 52.5% of all mined BTC has been inactive since at least March 2021, with holders not selling or transferring during the next bear market.
Bitcoin charts have been inactive for over 2 years.Source: Glassnode/Twitter
The number of addresses is also in “increment-only mode,” with a new intraday record for the number of wallets containing 0.1 BTC or more.
Non-zero balance wallets are also more abundant than ever, with 45,388,865 wallets as of March 27.
Bitcoin non-zero balance wallet diagram.Source: Glassnode/Twitter
With so much supply now going into cold storage, any push for BTC could lead to the perception that one of the world’s most secure assets is already too scarce.
According to Glassnode, the overall balance of BTC held on major exchanges remains near five-year lows.
BTC balance on the exchange. Source: Glassnode
just in time
For some, BTC price action is poised to repeat past cycles — and hit new all-time highs in the process.
These include Tedtalksmacro, who pointed out that the timing of BTC/USD hitting multi-year lows in November was perfect.
Since then, the rally that started in January has stalled, with no signs yet of a new macro low to break the $15,600 bottom from November 2022.
“The next BTC halving event is about 390 days away,” Tedtalksmacro wrote on March 27, citing a thread devoted to Bitcoin’s performance since late January.
About 390 days from next time #bitcoin cut in half. https://t.co/cR4ILrC7A2
— tedtalksmacro (@tedtalksmacro) March 27, 2023
As a result, BTC prices bottomed out more than 400 days before the next block subsidy halving, thereby adhering to historical precedent.
Meanwhile, Tedtalksmacro wasn’t the only popular commentator ahead of the price halving.
Earlier this month, Rekt Capital reckoned that the next all-time high would come within the next 18 months or so.
“BTC took about 900 days to recover from a downtrend breakout to a bull market top. If history repeats itself, BTC will peak in summer 2025.”
Source: Rekt Capital/Twitter
Crypto Market Sentiment Remains Greedy
Like last week, there is still an underlying factor in Bitcoin’s uptrend — and it comes from investors themselves.
Despite market volatility and an inability to approach $30,000 due to Fed rate hikes, Bitcoin is showing the kind of sentiment it has seen since hitting an all-time high in late 2021.
According to the Crypto Fear and Greed Index, the current market sentiment is filled with “greed”.
On March 21, the index hit 68/100, its highest since November 2021, and has hovered around the 60 region since then.
While not anywhere near “extreme” levels, the higher the index, the more likely a market correction is.
Crypto Fear and Greed Index. Source: alternative.me
- Bitcoin Creates Neutral Weekly Candle, Market Excitement Drops
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board pass
As reported by Cointelegraph
