© Reuters
Investing.com – Bitcoin significantly accelerated its correction on Thursday, falling to a low around $40,700, the lowest since January 3, and remains trending downward this Friday morning, at around $40,950.
Recall that the continues to suffer from profit taking, after the approval of Bitcoin ETFs by the SEC last week propelled the crypto to a more than one-year high, near $49,000.
But Bitcoin, other cryptocurrencies, and risk assets in general are also affected by the decline in expectations of a Fed rate cut, with strong statistics, including December US retail sales, having raised doubts among investors of the possibility of a rapid drop in rates.
Indeed, the Investing.com Fed rate barometer now only indicates a 54.5% probability that the Fed will lower its rates in March, compared to more than 70% a week ago.
As for this Friday, other US statistics will be worth watching with a view to having an impact on expectations for the Fed, with sales of existing homes and the consumer confidence index from the University of Michigan at 4 p.m.
Technical thresholds to monitor on Bitcoin
From a graphical point of view, it must first be noted that the fall of Bitcoin on Thursday led to a break below a trend line visible since the low of mid-November 2023, which constitutes an important bearish signal.
From now on, the psychological threshold of $40,000 is in sight, and a break below it would confirm the bearish reversal of the underlying trend. In this case, the $38,000 area will be the next potential support to consider.
Finally, on the upside, only a return above Tuesday’s peak at $43,588 would begin to challenge the immediate bearish bias.
***
ProPicks: AI-managed stock portfolios with proven performance
ProTips: Digestible information to simplify masses of complex financial data into a few words
Advanced Stock Screener: To find the best stocks according to your expectations by taking into account hundreds of financial metrics
Historical financial data for thousands of stocks: To allow fundamental analysis pros to dig into all the details themselves.
And many other services, not including those we plan to add soon!