BTC Price Returns to Terrible Resistance Area Due to Lack of “FOMO” – 5 Things to Know About Bitcoin This Week.
TC price action is showing renewed energy heading into the final week of March with a 5% gain on the day amid market consolidation higher. Can the bulls manage to return to price discovery?
That's the best-case scenario for a monthly shutdown. Bitcoin's rocky return contrasts with last week's grim mood, which saw consecutive losses.
The pullback from the current all-time high near $74,000 surpassed 17% at one point, and while still modest by bull market correction standards, it has many worried.
This week, the landscape is different – at least for now. The bullish CME gap has turned into a bearish gap and investors anticipate a fresh attack on the upcoming highs.
Combine that with increased mining difficulty and the classic bullish signals are clear.
Beyond Bitcoin, classic macroeconomic factors are likely to add some volatility to risk assets.
BTC price returns to the terrible resistance zone
In complete contrast to before, Bitcoin bulls had a pretty great weekend, closing the week near $67,200 and entering the new week with an increase of more than 5%.
While this was in fact $1,200 lower than the previous week's close, it recovered most of its recent losses when BTC hit a local low below $61,000 on March 20.
Now, the bearish gap in the CME futures market is a target to watch for renowned analyst Mark Cullen.
When occurring over the weekend, gaps up or down form a popular price attraction, with BTC/USD “filling” them within days or even hours as the new trading week begins.
“Let's see if that CME gap gets filled in the next 24 hours,” Cullen tweeted along with a chart showing “sectors of interest.”
However, market participants are showing strong caution about the strength of the Bitcoin bull market.
Trader JT outlined a series of oscillators, including the Relative Strength Index (RSI), all of which indicate a trend reversal, with “overbought” signals appearing on the timeframe two weeks.
“Bottom line: Bitcoin is overbought on 2-week oscillators and will need a close above $69,100 for bulls to regain momentum. And then the most important Fib 4.236.”
“As for support: $59,100 coincides with the 50SMA and is rising.”
However, before the weekly close, trader Alan Tardigrade saw a different story emerging on the daily RSI data. He believes that this figure has escaped the downward trend that existed for most of March. He wrote on X:
“Bitcoin's RSI is showing strength. Already seeing early signs of a Breakout in the daily RSI. At the same time, it also crossed above the 50 level, which suggests there could be a change in momentum from bearish to bullish on the daily chart. BTC is ready to pump next week.”
Analyst Kevin Svenson reached the same tentative conclusion based on another indicator, the daily moving average convergence divergence (MACD).
Bulls hope for a revival of the Bitcoin ETF
Closely tied to the story of spot prices is the concern surrounding US Bitcoin spot exchange-traded funds (ETFs).
New ETFs saw an anomaly last week, recording net outflows for the first time in their short life of a few months for five consecutive days.
This was driven by record outflows from Grayscale Bitcoin Trust (GBTC), which was impacted by moves from bankrupt crypto lender Genesis.
Now, commentators are also hoping for a return to “business as usual.”
“What do you think market participants will do tomorrow night when the ETF records inflows?” Quinn Thompson, capital markets and growth leader at crypto lender Maple Finance, asked questions over the weekend.
Thompson noted that despite net outflows from GBTC, the largest ETF providers maintained inflows, concluding that “new buyers are not selling.”
Thomas Fahrer, CEO of crypto-focused review portal Apollo, said :
“Grayscale
's GBTC sold 31,000 BTC last week and price dropped ~1%. Incredible demand to alleviate that selling pressure. As GBTC outflows become softer, BTC will take off . ”
PCE comes amid a huge US spending package
This week's key macro factor is the US Personal Consumption Expenditures (PCE) Index.
PCE, known as the US Federal Reserve's (Fed) preferred measure of inflation, follows last week's decision not to cut interest rates.
Fed Chairman Jerome Powell's statements after the meeting have raised predictions of consecutive interest rate cuts taking place before the end of the year.
The latest data from CME Group's FedWatch Tool puts the likelihood of a rate cut in May at 13.7%, up from less than 10% previously. The odds for June are 66%.
This week, Powell will speak again, likely reinforcing those beliefs. However, his appearance at the March 29 conference coincides with a holiday so the stock market will be closed.
“After two hot inflation reports this month, all eyes are on the PCE inflation report,” The Kobeissi Letter concluded .
Meanwhile, financial commentator Tedtalksmacro emphasized that last week's US spending package, worth $1.2 trillion, is laying the foundation for further price increases in risky assets.
“Fed confirms QT will slow down soon. The interest rate cut will take place at the end of the year. You need more BTC!”
Mining difficulty set to maintain record high
Despite the recent bearish BTC price volatility, the fundamentals of the Bitcoin network continue to show strength.
Latest estimates from monitoring source BTC.com suggest mining difficulty will likely remain at or near an all-time high of around 95 trillion, while hashrate paints a similar picture .
Raw data from MiningPoolStats shows a new hashrate record high of 741 exahash per second on March 24.
Miners continue to prepare for the upcoming halving event on April 20, which will reduce miners' rewards from 6.25 to 3,125 BTC per block.
However, when analyzing the impact of the halving, investor Mike Alfred predicts there will be mass reorganization as miners adjust to the new subsidy regime.
“We will see a major correction in global hashrate after the halving.
There are a lot of very old devices out there trying to make a last bit of profit before they are consigned to the dustbin of history. The major public mining companies are all getting new equipment. Super profits are imminent.”
Google shows a lack of mainstream “FOMO.”
Overall crypto market sentiment still appears to be “greedy,” but mainstream interest appears to be waning.
The latest data from Google Trends shows that after a modest spike during the recent trip to a new peak, “Bitcoin” search intensity is falling again.
Figures show search volume reaching just a fraction of its 2021 peak as Google users lose interest in Bitcoin's comeback.
Meanwhile, the Crypto Fear & Greed Index remains just below the “extreme greed” zone at 75/100.
However, for statistician Willy Woo, creator of data source Woobull, the power of the current Bitcoin bull market can no longer be underestimated.
Comparing Bitcoin to the S&P 500 last week, Woo made a clear distinction between “TradFi” and Bitcoin market behavior. He reasoned:
“In TradFi, the bear market was so steep, people panicked. Bitcoin bull market is so steep, people are FOMO.”
#Bitcoin#FOMO#BitcoinETF#BitcoinHalving#CryptoNews
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