Bitcoin (BTC) starts a new week facing multiple hurdles but with strong internal support — can old resistance below $50,000 finally fall?
A correction event now almost in its third month is frustrating many, but conditions may soon be right for a fresh charge against opportunistic bears, an increasing number of analysts are saying.
With inflation running hot and United States lawmakers set to make the Bitcoin mining debate public this week, there are plenty of potential pitfalls in store.
Nonetheless, it’s beginning to feel like Bitcoin is at the point where it is capable of producing a classic surprise when the majority of the mainstream economy least expects it.
Cointelegraph takes a look at five factors worth paying attention to when charting BTC price action over the coming week.
Bitcoin retains key weekly close level
Bitcoin looks decidedly uninterested in tackling even local resistance levels as the week begins.
After a rangebound weekend with little unique price action, BTC/USD is putting in lower lows on short timeframes while avoiding key zones around $44,000.
With Wall Street closed for a holiday, Monday could shape up to offer more of the same before markets provide direction.
Bitcoin did, however, manage to close out the week at exactly the crucial point identified by trader and analyst Rekt Capital as useful for aiding bullish momentum.
“A Weekly Close above ~$43100 (black) would be a good sign of confirmation for BTC to continue higher from here,” he wrote Sunday alongside an accompanying price chart.
“By turning black into support on the Weekly, $BTC would confirm a re-entry into its ~$43100-$51800 range.”
A subsequent dip took the largest cryptocurrency lower, with $42,337 on Bitstamp the local floor for Monday at the time of writing.
Also cautiously optimistic is fellow popular trader Crypto Ed, who is eyeing a potential replay of last week’s run above $44,000, something that bears subsequently quashed.
“Although it’s early but this looks like the start of continuation of last weeks move. Fingers crossed!” he summarized in part of his latest Twitter update.
Last week, meanwhile, Cointelegraph reported on sentiment favoring an upside breakout as an eventual outcome of the current ranging behavior.
Congress to discuss “cleaning up” crypto mining
The “stage is being set” in more ways than one this week as the topic of inflation returns to haunt U.S. markets and politics alike.
Amid a fresh flurry of headlines about how inflation is hitting consumers, the highest consumer price index (CPI) print in 40 years is already hitting President Joe Biden’s approval ratings.
Reining in the 7% year-on-year CPI increase could see the Federal Reserve enact no fewer than four key rate hikes in 2022 alone, Goldman Sachs forecast last week. This in turn places more pressure on weary consumers.
“The stage is being set in the coming weeks,” Pentoshi argued.
Closer to home, this week will see U.S. lawmakers discuss the alleged environmental impact of cryptocurrency mining.
With a significant chunk of the Bitcoin hash rate now coming from the U.S., any hostile policies will matter more than most when it comes to sentiment. A repeat of the China exodus from May 2021 — and its knock-on effect for hash rate and network security — will not be welcomed by anyone.
Hash rate, as Cointelegraph noted, is now back at all-time highs, fully recovered from last year’s events.
The Oversight and Investigations Subcommittee hearing is due to take place on Thursday, and is titled “Cleaning Up Cryptocurrency: The Energy Impacts of Blockchains.”
The hearing will be livestreamed in real time on the day.
Bitcoin “a bonfire covered in gasoline”
Bitcoin volatility is plumbing multi-year lows — encouraging for its acceptance as a mainstream asset, but not something many expect to last.
According to the Bitcoin Volatility Index, which calculates the standard deviation of daily BTC returns…
Read More: cointelegraph.com