Bitcoin

Fed Announces Inflation Warnings As Bitcoin Whales Remain In Wait Mode

Published

2 weeks ago

June 30, 2022

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Over the past few hours, the price of bitcoin has deviated from a key level of support and fallen below $19,000. The transaction history reveals that many addresses purchased Bitcoin for more than $20,000. These market players would soon liquidate their holdings to prevent further losses, which would set off a decline toward $16,000

Inflation Warnings Affect Bitcoin Price

Due to major inflation worries and rate hikes indicated by central banks, particularly the US Federal Reserve, BTC has almost lost half of its value over the previous month.

Bitcoin’s market valuation has fallen from $1.27 trillion in November 2021 to under $366 billion at present.

Jerome Powell, the chairman of the Federal Reserve, reaffirmed the Fed’s commitment to raising interest rates in order to reduce inflation. He stated during the ECB meeting that the challenge of inflation was more concerning to him than the potential for rising interest rates to cause the U.S. economy to enter a recession.

“Is there a risk we would go too far? Certainly, there’s a risk,” Powell said. “The bigger mistake to make – let’s put it that way – would be to fail to restore price stability.”

bitcoin

BTC/USD falls below $20k. Source: TradingView

Powell argued that the Fed needs to quickly raise rates because a gradual hike may give consumers the impression that increased commodity prices would not go away. He said that rate increases might be lessened before the next year.

Following Powell’s remarks, U.S. equity market futures declined, with those for the S&P 500 dropping 1.59% and those for the tech-heavy Nasdaq 100 losing 1.9%. Asian markets were down, with the Asia Dow index and Japan’s Nikkei 225 both down 1.54%.

Data Suggests Whales Are Waiting

On-chain data on CryptoQuant suggests that most traders are awaiting the next significant price decline. The price anticipation appears to be for a short-term opportunity, though.

On-chain data also implies that big whales are waiting for a good opportunity to accumulate cryptocurrencies, not only tiny and average traders. Data shows that, interestingly, whales’ holdings in Bitcoin are not now growing.

This demonstrates unequivocally that the whales are awaiting a better opportunity. Whales’ holdings between 100 and 1,000 and between 1,000 and 10,000 Bitcoins currently exhibit a flat line.

Featured Image from Pixabay and Chart from tradingview.com

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Bitcoin

Bitcoin Price Could Recover If It Holds This Key Support

Published

6 hours ago

July 13, 2022

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Bitcoin extended losses and traded below $19,600 against the US Dollar. BTC could start a recovery wave if it stays above the $19,300 support zone.

Bitcoin remained in a bearish zone and settled below the $20,000 level.
The price is now trading below the $19,600 level and the 100 hourly simple moving average.
There is a major bearish trend line forming with resistance near $19,600 on the hourly chart of the BTC/USD pair (data feed from Kraken).
The pair might start a recovery wave if it stays above the $19,300 support zone.

Bitcoin Price Reaches Key Support

Bitcoin price started a fresh decline below the $21,000 support zone. The bears gained strength and pushed the price below the $20,000 support zone.

The decline even extended below the $19,600 support zone. A low is formed near $19,256 and the price is now consolidating near a major support at $19,300. It is also trading below the $19,600 level and the 100 hourly simple moving average.

If bitcoin stays above the $19,300 zone, it might start a recovery wave. On the upside, the price could resistance near the $19,550 and $19,600 levels.

There is also a major bearish trend line forming with resistance near $19,600 on the hourly chart of the BTC/USD pair. The next key resistance is near the $20,000 zone (the recent breakdown zone). It is near the 23.6% Fib retracement level of the downward move from the $22,498 swing high to $19,256 low.

Source: BTCUSD on TradingView.com

A close above the $20,000 resistance zone could set the pace for a test of the 100 hourly simple moving average. Any more gains might open the doors for a move towards the 50% Fib retracement level of the downward move from the $22,498 swing high to $19,256 low. The next major resistance sits near the $21,200 level.

More Losses in BTC?

If bitcoin fails to start a recovery wave above the $20,000 level, it could continue to move down. An immediate support on the downside is near the $19,300 level.

The next major support now sits near the $19,250 level or the recent low. A close below the $19,250 support zone could accelerate losses. In the stated case, there is a risk of a move towards the $18,500 level.

Technical indicators:

Hourly MACD – The MACD is now gaining pace in the bearish zone.

Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now in the oversold zone.

Major Support Levels – $19,300, followed by $18,500.

Major Resistance Levels – $19,600, $20,000 and $20,500.

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Bitcoin

Bitcoin Daily Exchange Net Flows Shows Sell-Offs Have Not Subsided

Published

10 hours ago

July 12, 2022

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Bitcoin daily exchange net flows have been erratic for the last month, to say the least. This is due to the numerous swings between dumping and stacking being done by investors in the space, all of which have affected the price of the digital asset in their own way. However, the net flows have begun to find a balance and it is unfortunately not a positive one.

Outflows Start To Dominate

The inflows and outflows for the last day have not been alarming in a way but the fact that it continues to skew towards inflows which us a testament to the sell-offs that have rocked the place. The data from Glassnode which shows the net flows between the two shows that more BTC was moving into centralized exchanges than those going out of them. A total of $729.7 million BTC were moved out of exchanges in the last day, while inflows came out to $766.9 million. This led to a net positive flow of $37.2 million.

This comes as no surprise given that more investors are trying to get out of the digital asset to avoid incurring more losses. Even with the accumulation trend that has been recorded across large investors, it is still not enough to upset the amount of BTC being moved to centralized exchanges to be sold.

📊 Daily On-Chain Exchange Flow#Bitcoin $BTC
➡️ $766.9M in
⬅️ $729.7M out
📈 Net flow: +$37.2M#Ethereum $ETH
➡️ $316.1M in
⬅️ $281.1M out
📈 Net flow: +$35.1M#Tether (ERC20) $USDT
➡️ $364.9M in
⬅️ $403.5M out
📉 Net flow: -$38.6Mhttps://t.co/dk2HbGwhVw

— glassnode alerts (@glassnodealerts) July 12, 2022

This has negatively impacted the price of bitcoin given that the digital asset had declined below $20,000 once more. The fact that there is more USDT leaving exchanges than that coming in shows that investors are moving to stablecoins for safety. As such, they are not buying cryptocurrencies like bitcoin.

BTC loses footing above $20,000 | Source: BTCUSD on TradingView.com

Bitcoin Investors Try To Catch Up

Even though the price of bitcoin is still declining, the interest from investors, especially smaller ones, has not waned. This renewed interest is seen in the number of addresses holding at least 0.1 BTC. After falling during the price crash, the number has now recovered and has reached a new all-time high of 3,706,019 addresses with more than 0.1 BTC on their balance.

Now, this has not affected the price much in any way given these smaller investors have little control over the market. However, it speaks volumes about how investors are viewing the current market climate, which to many has become an opportunity to buy coins at a discount.

Nevertheless, the digital asset continues to maintain bearish momentum. More addresses are being triggered as the price decline continues. Bitcoin is trending at $19,670 at the time of this writing and has now fallen below its $400 billion market cap.

Featured image from Analytics Insight, charts from TradingView.com

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Into Crab Mode, Bitcoin Bullish Potential Capped For The Coming Months?

Published

15 hours ago

July 12, 2022

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Bitcoin is back below $20,000 and seems on track to re-test the bottom of its current range. The cryptocurrency was showing signs of recovery, but it was rejected near the critical resistance zone at around $22,000.

At the time of writing, BTC’s price trades at $19,800 with a 3% and 2% loss in the last 24 hours and 7 days respectively.

Bitcoin BTC BTCUSD QCP — BTC trends to the downside with sideways movement in recent weeks on the 4-hour chart. Source: BTCUSD Tradingview

In a recent market update, trading desk QCP Capital addressed the factor that might contribute to BTC’s price moving sideways for the foreseeable future. These included the upcoming Mt. Gox redemptions, and global inflation.

On the probability of the Mt. Gox repayments negatively impacting Bitcoin and the crypto market, QCP Capital wrote:

It is impossible to be certain about the exact impact, given the numerous cross-arguments and theories surrounding the release. Our main takeaway is that there is a high chance of BTC supply flooding the market soon.

In the best-case scenario, Bitcoin will face downside pressure allowing Ethereum and other altcoins to gain some breathing room. The sector might record some gains after an extended period of increased Bitcoin dominance.

The worst-case scenario is additional selling pressure for Bitcoin, as QCP Capital said, and the entire crypto market pushing prices to their yearly lows or deeper into bear market territory. A lot depends on Mt. Gox’s unlock schedule, and if the victims will succumb to market uncertainty or wait for BTC’s price to reclaim previous highs.

QCP Capital made the following prediction on what could be in store for Bitcoin in the short term.

We’re not outrightly bearish at these spot levels but we think the sudden demand for call structures might have pushed the risk reversal levels a bit too much to the topside. Our base case continues to be sideways trading with the risk of sharp dips and upside capped (…).

What Could Push Bitcoin Back Into The Green

Tomorrow, the U.S. will publish a new Consumer Price Index (CPI) print. After an aggressive shift in monetary policy from the U.S. Federal Reserve (Fed), market participants expect a decline in this metric.

If the CPI print signals a decline in inflation, the crypto market could see some relief. $18,600 and $22,000 will continue to operate as major support and resistance levels.

In addition, analyst Ali Martinez indicated that Bitcoin is sitting at an “important demand wall”. There are 570,000 addresses that purchased BTC around its current levels, to the upside $20,900 is the next level to watch in case of bullish momentum, as seen in the chart below.