Bitcoin (BTCAs the shock of the latest US inflation data passes, a new week begins approaching major resistance — can strength continue?
The weekly closing price on July 17 may have been substantially the same as last time, but BTC / USD shows the strength needed before Wall Street opens on July 18.
Last week was the time to test cryptocurrency Hodler everywhere. Inflation determined the mood for risk assets as a whole, and the US dollar overshadowed the dark atmosphere. These pressures are relieved and there is room for relaxation, at least temporarily.
At the same time, on-chain data suggests that this is a moment of success or failure for Bitcoin miners and that the market as a whole feels close to surrender.
As discussions continue on where the bottom of the Bitcoin macro lies, Cointelegraph will look at several factors prepared to shape BTC’s price performance in the coming days.
All eyes on the weekly moving average
Those looking at the BTC weekly chart will feel déjà vu this time — BTC / USD ended on July 17th, down $ 100 from July 10th.
The latest weekly closing price is like a disappointment in itself, and Bitcoin erases the gain at the last minute to print the “red” candles of the last seven days.
On the other hand, what happened next was the opposite tone. Marching quickly overnight, the largest cryptocurrency added $ 1,400 within 12 hours.
It all leads to familiar challenges in the daytime time frame — the BTC / USD is approaching both the $ 22,000 and $ 22,600 key trendlines in the form of a 200-week moving average (WMA).
Previously Support in the bear marketThe 200 WMA, in fact, turned into resistance this time, was lost in mid-June and never regained.
Therefore, analysts are looking at that level as an important area of interest if the bulls can withstand the upward pressure.
For Plan B, the creator of the Stock-to-Flow family of BTC pricing models, factors beyond spot prices add to its importance. Similar to the previous bear market, 200 WMA temporarily exceeded the realized price of Bitcoin this year, providing a classic market reversal signal.
Realized price is the average price at which all existing Bitcoins moved last.
“In the bear market on 2014/15 and 2018/19 (blue), the realized price exceeded 200 WMA, and the bull market did not start until the realized price and 200 WMA contacted.” Plan B Said Twitter followers on July 17th with the attached chart.
“Currently, the realized price and 200 WMA have already reached $ 22,000. The next bull market will require a realized price and BTC above 200 WMA.”
As a coin telegraph report, The Bulls also seem to need to play the moving average game in a longer time frame. In addition to 200 WMA, the forecast includes the 50-week and 100-week exponential moving averages (EMA).
The 50 EMA is currently at $ 36,000 and the 100 EMA is just above $ 34,300. Cointelegraph Markets Pro When TradingView show.
Ethereum is approaching $ 1,500 with potential trendsetter moves
One of the catalysts that could push Bitcoin over the $ 22,600 major resistance mark could come from an unlikely source, altcoin.
Usually moving with Bitcoin sees other cryptocurrencies before the copycat moves up and down, but this week wait to see if BTC / USD follows the largest altcoin ether Some people are (ETH)taller than.
In the news of the transition to Proof of Stake (PoS) mining May be completed soonEthereum has outperformed in terms of recent price increases, up 25% in the past week alone.
At the time of writing this, ETH / USD was trying to challenge $ 1,500 for the first time since June 12th.
“$ Eth has regained a 200-week moving average this week. Btc will probably be next week. The bearish season is nearing its end,” said the popular Twitter account Bluntz. wrap up On that day.
Fellow commentator Wright also believes that Ethereum’s strength should continue to put upward pressure on Bitcoin, ignoring ETH’s move and focusing on liquidations among traders whose BTC remains short. did.
The shorts took days to appear in BTC. 0 reason to shorten it when ETH does what it did.
The large assets of the ecosystem that rip 40% pose the risk of seeking action elsewhere. It makes people think that an asset can actually go up in price. It leads to a catch-up / rotation flow. https://t.co/nae0WIys9M
— Light (@lightcrypto) July 18, 2022
24-hour cross-script short clearing by July 18 totals approximately $ 132 million, data from on-chain monitoring resources Coin glass confirm.
However, not everyone is confident that Ethereum will be able to break the overall downtrend in the future, and as a result, other tokens will be affected.
Coin Telegraph contributor Michaelël van de Poppe argued that closing the Bitcoin gap in weekend CME futures could shatter optimism.
CME futures closed their previous trading day, July 15, for about $ 21,200.
“There may be a CME gap under us (and Bitcoin is swimming around the previous CME gap), so I’m not surprised by the fake move and retest lower at $ ETH. “He writes update..
“I want to be long in the $ 1,250-1,280 region.”
Dollar strength eventually flips in favor of Bitcoin
When it comes to the topic of macro movement, the landscape looks less enthusiastic overall than the one that welcomed crypto investors last week.
Inflation data The debate over whether inflation peaked in the United States thus cools to the next consumer price index (CPI) print in August.
The Federal Reserve will decide later this month how to tackle inflation with respect to major rate hikes, yet the Federal Open Market Committee (FOMC) has been set to meet only on July 26. ..
Therefore, macro clues about BTC’s price behavior come from other regions, and geopolitical triggers are at the top of the list of potential factors.
The Asian market was stronger as the week began thanks to the modest recovery of Chinese tech stocks previously struck by the nerves of the coronavirus.
At the same time, the US dollar, a star in recent weeks when stocks around the world have felt pressure, has begun to intensify its rise.
The dollar index (DXY) has long been inversely correlated with crypto asset performance, falling below $ 108 on the day. Fresh 20-year high last week.
“We’re finally seeing a daily depression,” said Income Sharks, a Twitter analyst. commentEmphasizes the possibility of DXY testing the trend line from May.
“Even this drop to the trendline will be big for equities and crypto. It will be in perfect agreement with the bullish week before the Fed.”
Fellow account Rickus also felt that Bitcoin wouldn’t “break down again”, even though pullbacks are still possible, thanks to the DXY comedown and the stronger finish of the S & P 500.
SPX did a good close before the weekend, DXY also looks a bit weak at ltf while BTC is close to the resistance level .. The line I’m looking at .. I’m looking for a pullback but I I personally don’t think it will break down again. pic.twitter.com/KcYRJFrrbS
— Rickus (@rickus_trades) July 17, 2022
“We need to give room to bounce this week until equity and crypto are nearly supported,” said 0xWyckoff, creator of the crypto trading resource Rekt Academy. Added Part of a thread about DXY.
and Another observation Meanwhile, Danta Piero, managing partner and CEO of 10T Holdings, said the appreciation of the macro US dollar against the Chinese yuan should be a turning point for BTC.
“The last three major BTC highs in 2014, 2018 and 2021 were in close agreement with the highs of the Chinese yuan / lows of the US dollar,” he said in a tweet on July 18. I am.
“The peak of the dollar immediately supports the low BTC.”
Miners dump 14,000 BTC in a few days
The data on the chain showing Bitcoin miners selling inventories looks even darker, very much in the hope that a trend turnaround could appear on the card.
According to data from the on-chain analytics platform CryptoQuantAfter July 14th, the miners Important chunk Of BTC from their reserves.
As a result, miner reserves have fallen to their lowest levels since July 2021, and BTC prices have also fallen to low levels.
The reserve on July 18 was 1.84 million BTC, a decrease of 14,000 BTC from the aggregate on July 14.
For Edris, the contributor to CryptoQuant, the numbers are a promising sign, suggesting that miners are helping to set macro BTC minimum rates.
“The Bitcoin miner is finally taken hostage,” he said. wrap up On the weekend.
“BTC prices have been integrated at $ 20,000 levels over the past few weeks, and investors are wondering whether the accumulation or distribution phase is underway. Looking at the miner sanctuary charts, The latter seems to be the case. “
Meanwhile, macro analyst Alex Kruger Explained Miners’ sales in June were “a clear sign of surrender,” he added, “accumulating along the way and tending to vomit when things get worse.”
RSI causes “very rare” BTC price inflections
Finally, analysis suggests that the “rare” events on the Bitcoin chart may have only provided fuel for historic turnarounds.
Related: Top 5 cryptocurrencies to watch this week: BTC, ETH, MATIC, FTT, ETC
Taking the BTC / USD chart from the beginning of Bitcoin’s life, Stockmoney Lizards is a log chart trend line that caused the largest BTC price recovery with the Bitcoin Relative Strength Index (RSI) currently at a reasonably low level. Pointed out that it is combined with touch.
“It’s an exciting and very rare situation right now.” publication On the weekend.
“The RSI fell below 45 and the logarithmic bottom showed a major reversal in the past, followed by a crazy bull run. Cross = RSI <45+ log. Below."
The attached chart is by RSI The lowest level on record..
Meanwhile, for CoinPicks analyst Johnny Szerdi, Bitcoin had to break the 50 mark on the RSI, a major resistance zone in recent months, to avoid the risk of new selling.
GM! #Bitcoin It is at a critical point. Since 3/14, it has not been possible to exceed 50 RSI. I refused 5 times after 4/20. Notice the vertical line up to where it coincides with the big sold out. If you have volume, rejecting it 6 times here could mean another sold out. pic.twitter.com/znZNpfJ3K8
— Johnny Szerdi (@johnnyszerdi) July 17, 2022
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