Bitcoin Bear Market Back Or Slight Correction? Here’s What’s Going On
Yesterday’s news that one of the largest US exchanges, Kraken, would have to pay a $30 million fine to the US Securities and Exchange Commission and close its crypto staking product to US customers caused a lot of uncertainty, including in the bitcoin market.
In recent days, it has become increasingly clear that the US authorities have strict targets on crypto companies in the wake of the FTX collapse. In particular, the efforts of the US authorities are aimed at the banking sector, which provides entry and exit for exchanges and stablecoins.
So, while at first glance the rate of crypto has nothing to do with bitcoin, there are fears that centralized exchanges in the US are facing serious problems that could also affect the bitcoin market.
In this regard, it is not surprising that the price of bitcoin lost support at $22,370. The support level has been tested five times since January 23rd. Yesterday’s news failed to be swallowed up by Bitcoin bulls.
For now, BTC has hit a low of $21,633 with the next support region at $21,600 to $21,500. If support also breaks, the 200-day exponential moving average (EMA) could provide the most important support, currently at $21,383.
Bitcoin bears or bulls taking over?
The good news is that the daily RSI has fully returned to the neutral 47 level after hitting 87 in mid-January. On the other hand, the spot glass of the largest spot exchange Binance is also showing strong support between $21,400 and $21,600 as buy walls formed in this range.
$BTS Binance Spot Order Book.
Look at these 21.4-21.6k buy-walls, I’ll keep a close eye on them. #Bitcoin pic.twitter.com/UCK97jeI2U
— exit pump (@exitpumpBTC) February 9, 2023
As long as the bulls defend the area above the 200-day EMA, the current price trend can be dismissed as a healthy correction. The uptrend remains unchanged.
However, if BTC falls below the 200-day EMA, this could be seen as a failed attempt by Bitcoin bulls to set up a trend change. Also, it can be interpreted as bearish for Bitcoin as the price is (supposedly) unable to set a new high for now on the weekly chart.
An analyst at Rekt Capital shared the following weekly BTC chart and stated:
BTC makes another false break after failing to retest the ~$23,400 level as support. In the process, BTC formed a new low high resistance level.
Meanwhile, from a network perspective, Bitcoin’s momentum is shifting in a positive direction. The Adjusted Exit Profit Ratio (aSOPR) goes beyond 1.0, showing that the market has realized profits online for the first time since April 2022, as explained by analyst James Straten.
This is also confirmed by the realized profit-to-profit ratio. The market is currently realizing more of the gains in USD than the losses. Sellers with unrealized losses are exhausted and usually adjust to a healthier influx of demand.
Credit : www.newsbtc.com