Bitcoin’s price trades in tight areas between $18,000 and $19,000. Following a rejection of the $20,000 threshold, Bitcoin has moved sideways. This is due to increased fear and uncertainty in this emerging market.
The Bitcoin price is currently trading at $19,000. There has been a 2% gain in the past 24 hours, and a loss of 1% over the last week. A potential rally in relief could be possible due to the influence of macro factors on global markets. This is evident from the bearish sentiment and fear seen in crypto market.
Bitcoin Price Forms A Bottom… For Now
After last week’s U.S. Federal Reserve (Fed) announcement of a new interest rate hike, the Bitcoin price has been dominated by selling pressure. The cryptocurrency was pushed to $18,000 by bears. This is its lowest point in a long time.
These levels have been operating as critical support as BTC’s price trends to the downside from an an-all time high of $69,000. These critical levels have remained constant as Bitcoin’s price has fallen from $69,000.
Analyst Justin Bennett believes BTC’s price is re-creating a price action displayed back in early 2022. That time the Bitcoin price was recovering after a huge crash. It formed a channel that ranged between $37500 and $49,000.
This pattern was followed for many months by cryptocurrency trading, with the only exception of macroeconomic development which pushed it down. In May 2022, another major crash took place.
Bennett thinks that the Bitcoin price may be following a similar pattern since June, with potential resistance at $27,000. Below, Bennett believes that BTC reached its bottom in the current pattern. He might consider retesting the top for $26,000 or less before it crashes below $18,000.
The analyst wrote: “Same structure for $BTC as Feb-April, only we’re missing a retest at $26,000”.
The Macroeconomics Are Ready to Support a Bitcoin Price Relief Rally
Tom Dunleavy, Senior Analyst at Messari, has also provided data that suggests that crypto markets might be able to benefit from the return of traditional markets. High correlation has been observed between stocks and risk-on assets such as Bitcoin, which is seeing the Fed raise interest rates.
(1/5)It is possible to be unlucky for another week. However, everyone knows that a bottom occurs when peak bearishness hits.
Is it almost over?
A few interesting facts: Futures positioning shows that leveraged accounts have fallen by an enormous margin in the past year. pic.twitter.com/VsXwFHj6na
— Dunleavy (@dunleavy89) September 26, 2022
As of this writing, the bearish mood in the financial markets appears to have reached levels not seen since 2020 when the COVID-19 pandemic began. This can be a sign of market bottoms and possible relief if short positions are piled up.
Dunleavy says that the Put/Call ratio (P), a measurement used to determine the difference between call (buy) and put (sell), is at a peak of 1. The result can be translated to a strong bearish sentiment on global markets.
When the current Put/Call Ratio stood at this level, Bitcoin and other crypto markets entered a multiyear bull market and reached a new high. The current macroeconomic situation might limit any bullish price movement, but the momentum could still be strong enough that it could reach $26,000 as Bennett suggested.