A 6th predictable ? – Bitcoin (BTC) is approaching levels near $30,000. Is the collapse of the price due to a one-time cause, or was this fall predictable in view of the data on chain and markets? This trader still wants to put a little green, on markets painted in blood red.
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Bitcoin around $30,000: can’t wait for the reversal!
bitcoin price falls up to around $30,450 on Bitfinex today, May 9, 2022. Bitcoin trades at $31,325 at the time of writing, and is currently recording a significant daily loss of 8.56%.
The markets are entitled to their fifth consecutive red daily candlestick, showing a market capitulation that began almost a week ago. The on-chain and market data also seem consistent with this strong downward movement in the price of bitcoin.
The 7-day moving average of bitcoin exchange fee dominance which, according to Glassnode, amounts to 15.2%, corresponds to the second highest level in bitcoin history. This data would thus confirm “that bitcoin investors have sought to reduce risk, sell and/or add margin collateral in response to market volatility”.
The change in the supply of stablecoins would also show the increase in the risk sentiment perceived by traders and investors in the markets.
This offer had peaked at $161.53 billion in early April 2022. It has decreased by about $3.285 billion since. This decline is due to the redemption of USD coin (USDC) which has exceeded the issuance of new stablecoins in general.
The trader Rekt Capital nevertheless tried to qualify the current decline. He shared a weekly bitcoin price chart, to show that the cryptocurrency “entered in an area of historical demand that preceded reversals in early and mid-2021”.
The $35,000 didn’t hold, and bitcoin’s current major support now sits just above $30,000. Will the long-awaited bullish reversal, with a possible conquest of the current all-time high, take place? Or are traders still looking at the glass half full when bitcoin may really have entered a multi-month bearish phase?
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