Bearish view
- Sell the BTC/USD pair and set a take-profit at 25,760.
- Add a stop-loss at 27,200.
- Timeline: 1 day.
Bullish view
- Set a buy-stop at 26,550 and a take-profit at 27,477.
- Add a stop-loss at 25,760.
Bitcoin price has held quite well in the past few days. The BTC/USD pair has remained above the key support at 26,000 since September 13th. It has dropped by ~4.13% from its highest level this month.
Market risks rise
The BTC/USD pair has moved sideways in the past few weeks. It has outperformed stocks as the Nasdaq 100 and S&P 500 have retreated by more than 7% from the highest levels this year.
It has also done better than bonds. The 10-year, 30-year, and 5-year bond yields have jumped to the highest levels in years. Bond yields move inversely to prices. They have risen in the past few months as the Federal Reserve has moved aggressively to fight against inflation.
The US dollar index (DXY) has been in a strong bullish trend in the past few weeks. It has risen to over $105.6, the highest level in more than 6 months. Historically, Bitcoin tends to have an inverse relationship with the US dollar.
It is not clear why Bitcoin is doing well in this environment. A likely reason is that there are still hopes that the Securities and Exchange Commission (ECB) will approve at least one of the spot ETF proposals. Several large companies like Blackrock, Invesco, and WisdomTree have filed for their spot ETFs.
A Bitcoin ETF will be positive for the ecosystem since it will lead to more inflows from institutional investors. Another important event is the ongoing Bitcoin purchases by MicroStrategy. The company bought 5,445 coins valued at over $150 million. It now holds coins worth over $4.6 billion in Bitcoins.
BTC/USD technical analysis
Bitcoin has held quite well in the past days as American stocks retreated recently. The BTC/USD pair retreated to a low of 25,990 and then bounced back to a high of 26,417. It has moved slightly below the 50-period moving average while the Relative Strength Index (RSI) drifted upwards.
The pair remains below the Ichimoku cloud. Therefore, the pair will likely remain in this range in the coming days as investors target the key support at 25,760. The stop-loss of this trade will be at 27,000.
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