After experiencing a price drop on Thursday, bitcoin broke above a short-term bearish trend line with resistance near $22,850 on the hourly chart and is now attempting another recovery wave but might face hurdles near $23,100.
At press time yesterday evening, the global cryptocurrency market cap declined 1.2% to $1.06 trillion. If it fails to cross the resistance zone and 100 hourly SMA it could continue to move down. The next major support is now near the $22,400 level below which further price decreases might be seen, with the possibility of reaching a level of $21,200.
Early Friday morning the BTC price reversed after the Labor Department reported that the U.S. economy added 528,000 jobs in July, double the number expected by most economists. This means that the Federal Reserve intends to stick to its plan to curb inflation and raise rates.
Usually, aggressive policies mean bad news for “risk” assets like bitcoin and stocks. This plus the news that the Chicago Mercantile Exchange will roll out bitcoin euro and ether euro futures has had little to no effect on bitcoin as it continues to trade between the range of $22,900 and $24,500 over the last seven days, losing 3% during that period.
About this time last week bitcoin’s price was at $24,000 and by Saturday we saw it push even higher attempting to reach $25,000. Unfortunately it did not continue this momentum into the next week as sellers stepped up and sent the market into a correction.
Despite this, some investors seem to think that the daunting crypto winter is finally over. Anthony Scaramucci, founder of SkyBridge Capital believes that bitcoin won’t dip below this year’s lows again. While market analysts like Edward Moya say that regardless of the correlation between bitcoin and equities, bitcoin has been underperforming in the past but all hope is not lost.
While nobody knows what the future holds, rebounding to spectacularly new highs after experiencing the most severe slumps is nothing new for bitcoin.
