The BTC/USD continues to drop a bit as the market continues to see a lot of negativity. It does make quite a bit of sense that we could see this market drop in a “risk-off environment”, which of course we find the world in. Furthermore, the market now has to worry about the jobs number during the Friday session, which will have a major influence on what happens next, as the markets are moving mainly due to monetary policy in the United States. As the Federal Reserve tightens monetary policy, it has a major influence on economies around the world, and therefore a lot of other markets that you would not necessarily think of, specifically cryptocurrency.
Cryptocurrency needs a “risk on” type of environment to flourish, and it’s almost certainly going to remain “risk off” in the short term. At this point, the market is likely to see a lot of rallies are going to continue to be sold into, because the monetary policy is going to continue to be very tight and if the jobs number ends up being stronger than anticipated, that could have people running away from everything that is not called “the US dollar.”
Negative Pressure Ahead
- If we were to break down below the $18,000 level, it could very well send this market much lower.
- At that point, I would anticipate that Bitcoin drops down to the $15,000 level, possibly even as low as the $12,000 level.
- This is a market that I think continues to see a lot of negative pressure, so rallies at this point should end up being nice selling opportunities.
This will be especially true near the 50 Day EMA which is sitting right around the $22,500 level. In general, Bitcoin looks as if it’s going to continue struggling going forward. As long as the US dollar continues to strengthen, I don’t have any interest in trying to get overly cute with the market, and I do believe that the market will continue to look at this as a market that has no real upward momentum. As long as we are heading into recession, it’s difficult to imagine a situation where institutional money will flow back into this market. Until that’s the case, I do not think that upward momentum is going to happen anytime soon.
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