Will Bitcoin (BTC) keep the critical level of $29,250 until the close of the month?
Date: 2023-07-26 Author: Karina Ziganova Categories: CRYPTO PAYMENTS
The bullish momentum that led bitcoin to a new yearly high has all but come to naught: yesterday, the price of BTC briefly fell below the $29,000 mark
Over the past two weeks, the dynamics of the price of the main cryptocurrency inspired traders with optimism, but yesterday the situation changed dramatically. Well-known analysts of Rekt Capital and The Wolf of Few Streets shared their thoughts on what is happening in the market.
Declining volatility threatens BTC support
According to Rekt Capital, the $29,250 level is critical for bitcoin. Consolidation below it may lead to a trend reversal and a retest of the horizontal support of $28,200. The analyst notes that BTC has more than a week to hold this level, since the most important benchmark is the closing of the July monthly candlestick.
Currently, the main cryptocurrency is trading at $29,100, deviating from the 50-day moving average (MA). This is consistent with the Squeeze Momentum indicator, which indicates a downtrend. Historically, such signals lead to a consolidation period of 15 to 30 days after a sharp drop similar to the one that Bitcoin recently experienced.
However, the bulls should not despair yet. The Average Directional Index (ADX) is rising, indicating a loss of current momentum.
If the downtrend continues, the next important support levels will be $28,200, $27,200 and the 200-day MA. The moving average is crucial for long-term price performance and is currently at $26,800. Its loss could put the entire growth of recent months in jeopardy.
The market froze in anticipation of a decision on the key rate
The broader crypto market is under pressure ahead of the Federal Open Market Committee (FOMC) meeting to be held on July 26. CME Group's FedWatch tool shows that most bidders expect another 25 basis point increase in the key rate.
However, according to the crypto trader known as The Wolf Of Few Streets, the support levels of $28,800 and $28,300 should prevent a significant drop. The analyst believes that the rate hike is already priced in, and BTC will bounce off one of these levels and test the $32,000 mark again.
In addition, The Wolf Of Few Streets is awaiting approval by the US Securities and Exchange Commission (SEC) of one or more applications for a spot bitcoin ETF, which will provide additional support to the market.
The trader does not see any immediate negative factors for BTC and believes that the current selling pressure is temporary.
