The Bear Case for Bitcoin - likely to test 20k this year
Bitcoin remains rather bearish as the current price stays below the bull market support band (20w MA and 21w EMA). It has broken the support levels in Jan/Jun,Jul 2021 and is likely to go down from here, possibly test the 20k level in the next few months.
A trend reversal would require Bitcoin to break the resistance levels (orange) and get above the bull market support band, unlikely to happen in the short term.
Given the current macroeconomic volatility and geopolitical instability, Bitcoin is still viewed as a volatile asset and is losing its narrative as the hedge against inflation. There is also increasing correlation with the SP500 and Nasdaq100 since end 2020 so investors and speculators are less likely to buy BTC - trading volume this year has been lower than most months of 2020 and 2021. Investors this year also do not have the free government money anymore.
The recent Terra crash would also fuel the FUD and invite more central bank regulations on cryptos.
There is definitely more downside to crypto and Bitcoin for the rest of 2022.
A trend reversal would require Bitcoin to break the resistance levels (orange) and get above the bull market support band, unlikely to happen in the short term.
Given the current macroeconomic volatility and geopolitical instability, Bitcoin is still viewed as a volatile asset and is losing its narrative as the hedge against inflation. There is also increasing correlation with the SP500 and Nasdaq100 since end 2020 so investors and speculators are less likely to buy BTC - trading volume this year has been lower than most months of 2020 and 2021. Investors this year also do not have the free government money anymore.
The recent Terra crash would also fuel the FUD and invite more central bank regulations on cryptos.
There is definitely more downside to crypto and Bitcoin for the rest of 2022.
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BTC tested 20111. which hit my target of 20500. I didn't expect BTC to go down this fast but I guess it has been very responsive to the macros lately.