Since reaching an all-time high of $69,000 in November 2021, the price of bitcoin has been on a downtrend. The current decline resulted in a June low of $17,622. The subsequent boom created a long lower wick.
The bounce confirmed the support at the $19,200 horizontal zone. The area previously acted as resistance during the 2017 all-time high and then in January 2021. Now it is expected to be supported.
bitcoin stuck below $20k
The largest cryptocurrency has been unable to cross $20,000 since crashing past that crucial range last Tuesday. Bitcoin remains above $18,000, its lowest during the mid-June selloff, even though it is still trading at less than a third of its all-time high, up from $69,000 in November 2021.
The bulls tried to take the currency back to $22,000 on the charts, but a strong selloff brought it down to $19,000. The key support level for the coin was $17,000, and if the bears continue with their attacks, BTC may be able to move higher in the upcoming trading session. The market capitalization of all cryptocurrencies is currently $914 billion, up 0.3% from the previous day.
BTC price is trading at $19,000 on the four-hour chart. A couple of weeks ago the BTC/USD pair traded at similar levels, before attempting to recover on the charts. Resistance for BTC first appeared at $22,000 and later at $20,000.
The $22,000 level has presented BTC with significant resistance, and the coin has had difficulty trading above it for a long period of time.
If the current price action for BTC continues, $17,000 will soon be next.
There was a sharp drop in BTC/USD trading volume and the bar on the chart turned red, which is a bearish sign. There is selling pressure in the market.
However, the overall picture is still negative as there are no signs of tightening of financial conditions by central banks in equity markets. After a weak rally last week, BTCUSD is still trading below the 200-week average on the weekly chart.
A historical oddity, the RSI is still oversold on the weekly chart. Unfortunately, this does not indicate that now is a better moment for the bulls to enter. In theory, a continuous transition from extreme to ideal would indicate a buy signal.
BTC/USD Slides below $20k. Source: TradingView
The second quarter of 2022 saw bitcoin’s worst performance in eleven years. Investor Michael Bury, who correctly predicted the 2007 mortgage crisis, admitted that BTC and stocks are only in the middle of a bear cycle.
According to the CEO of cryptocurrency exchange Binance, Changpeng Zhao, the current collapse of the cryptocurrency market is a favorable time to invest in bitcoin. According to him, traders who can sustain through the current bear market will see their investments increase during the following bullish phase.
Further complicating issues are the absence of institutional investor demand, international sanctions and the collapse of critical support levels.
Related Reading | Bitcoin Struggles at $19K, Is $17K the Next Target?
The weekly moving average number of individual bitcoin addresses reached 18.8 million on July 3, 2022, according to data from cryptocurrency on-chain company Glassnode. According to statistics, the current carnage has caused the average bitcoin holder to suffer its biggest monthly loss since 2011.
Number of Addresses in Loss. Source: Glassnode
According to analysts at Cryptoquant, the whale ratio measure, which shows the selling trend of large wallet holders, predicts that the price of bitcoin will soon bottom out. The top 10 inflows of bitcoin to the exchange are divided by the total daily inflows to reach the whale ratio indicator. Higher values of the measurement reflect a change in value.
The analyst noted that whales are quickly moving their bitcoin holdings to cryptocurrency exchanges and are taking significant losses.
Related Reading | TA: Bitcoin Remains in Downtrend, Could a Sharp Rise
Featured image UnSplash, chart from TradingView.com