Bitcoin is retreating after rejection north of the crucial resistance near $20,000 and may be ready for a new phase at its last support level. The cryptocurrency was seeing some gains earlier this week, but macroeconomic forces have erased any bullish momentum.
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At the time of writing, bitcoin (BTC) is trading at $19,600 with a loss of 2% over the past 24 hours and has been trending sideways throughout the week. The rest of the crypto market has followed the sentiment in the crypto market, proving that, once again, any potential rally is overshadowed by the bigger picture.
Bitcoin Ends Leverage Period, Time for a Squeeze?
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According to analyst Justin Bennett, bitcoin tumbled towards $19,600 with little leverage to push players out of their positions. The cryptocurrency often moves in the opposite direction to most traders and makes a run for the liquidity pool created by over-leveraged positions.
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In this case, retail traders may have jumped into the bullish price action experienced this week by taking a long time in anticipation of further appreciation. Bennett believe that With these players out of the way, the market could be ready to boom:
As reported on Discord yesterday, BTC long liquidated moves at $19,600. Now is probably the time for a rally to $20,500. For now, trade both sides of the range.
In general, Bennett has been bullish on Bitcoin and will remain biased as long as the BTC price stays above $18,700. This price is the bottom of a potential channel formed by the cryptocurrency over the past months.
The recent price action is indicating a protracted relief rally towards the $26,000 area. In the short term, with leverage out of the game longer, it may be time to squeeze the shorts. analyst couple,
I still think it is only a matter of time before we see short liquidations between $20,450 and $20,800. Playing the range for now.
Macro Forces Pushing the Crypto Market
What Driven Bitcoin to Crash From Its Weekly High? A pseudonymous trader believes it was recent data on job numbers in the US economy. This report could provide support for the US Federal Reserve to continue raising interest rates to reduce inflation, and consequently riskier assets.
As reported by NewsBTC, the Fed’s monetary policy has been costly for equities and the crypto market is moving ahead with these assets, with job numbers now telling the financial institution that it may continue to pressure the markets. .
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However, this trader believes that the price action has recently returned to a sideways pattern, and Bitcoin may avoid any destructive price action for the time being. Via Twitter, this merchant Told,
This puts us back in the middle of the eternal 18.5-20.5K zone and because of this we are largely out of any break outs, be it up or down. Unless something special happens, I’d say it’s likely that we’ll be around this area until at least the CPI numbers next Wednesday.
