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Bitcoin analysis – Is it back above $20,000?

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It was a good start to the week across all risk asset classes. With a wind of euphoria starting to settle in investors’ minds. In fact, a battery of macroeconomic indicators such as the falling rental pricesThis could suggest that the Fed may ease its monetary tightening.

Unfortunately, as of yesterday, The results of GAFAMs, which in turn have a significant weight in the U.S. equity indices, were a cold water pitcher across the board. With the exception of Apple, which limited the damage well, all other members of the acronyms have faltered. So much so that we would have the feeling of participating in the end of an era in the financial markets.

Given the correlation with the Nasdaq, Bitcoin has not done badly to hold on to gains since last Tuesday. Especially since. the latest technical analysis so far confirms the recovery above $20,000 or ATH of 2017.

In a market context in which the confusion is totalLet’s see what graphical arguments allow BTC to get out of its gloomy state or not.

Bitcoin in weekly units – Awaiting a confirmation of a breakout from the descending line.

In the last weekly review, we mentioned that the break of Bitcoin prices above the downtrend line lacked conviction. Although we thought the recent bounce would be a game changer, Doubts remain as to whether Satoshi Nakomoto’s digital currency will be able to overcome the looming resistance.

Weekly Bitcoin price analysis - October 28, 2022.

Although one of the pillars of the bear market has given way to a lesser extent, the error would lead us to deduce that we are out of danger. Except that Weinstein Phase 4 is still firmly in place. Because precisely in the midst of a downward dynamic, the 30-week moving average (weekly MM30) is falling below resistance at $26,000. And on the other hand, let’s not forget that the technical indicators are still below their respective waterlines.

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In the event of a pullback to the $20,000 support, many investors would welcome a return of BTC to the $26,000 contact. With the addition of a double bottom that would see the light of day in weekly units provided we have slightly favorable factors on the fundamental front. But at the same time, beware of the weekly MM30, which could play a trick on buyers.

Bitcoin in daily units – The end of a status quo around the 2017 ATH?

After bullish candles on Tuesday and Wednesday, the Bitcoin was able to regain the $20,000 mark. This has caused the MACD and RSI to move back above the zero line and the neutrality zone at 50, respectively. And given that the upside move was violent, the small consolidation we are seeing is not all that surprising. It does not call into question the gains made since Tuesday.

That said, the status quo from mid-September still persists around the 2017 ETS. In order for buyers to get smiles back on their faces, prices would have to approach the $22,000 resistance again. In this sense, some of the work would already be done before considering $26,000.

In contrast, there are two scenarios that would be obvious. The first would be a continuation of the status quo. As for the second, a dry exit of prices below $20,000 would emerge a third wave of structural correction since its last ATH in November 2021. And as a result, bearrun would take on an emotional dimension, which in itself could derail cryptocurrency investors.

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BTC – Hope lives on as long as there is something to hold on to.

The violent rebound earlier this week has rekindled hopes that bitcoin can break out of its bear market since its last ATH in November 2021. As long as the market environment remains gloomy but not rocky, buyers can dream. But nevertheless, we wonder about the real reasons for this move. Because other than a slight strengthening of the dollar index and bond interest rates, we have nothing to go on.

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And it’s not just the main engine that carried BTC (or cryptocurrencies) that’s gone. Yes, it’s true, the era of abundant Fed liquidity is over, and for a long time, given the tenacity of inflation. But to accentuate what is happening now, Bitcoin-backed ETFs are being squeezed in outsized proportions.

Therefore, Investors should be under no illusions about the general trend of bitcoin. And given that its bear market psychological state since its last ATH in November 2021 does not appear to be peaking, the 2022 vintage could potentially be worse. Unless we get something concrete from the US central bank.

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