Bearish view
- Sell the BTC/USD and set a take-profit at 18,000.
- Add a stop-loss at 20,000.
- Timeline: 1-3 days.
Bullish view
- Set a buy-stop at 19,800 and a take-profit at 21,000.
- Add a stop-loss at 18,000.
The BTC/USD price continued consolidating in the Asian session as bond yields rose and American stocks pulled back. It was trading at 19,171, where it has been in the past few days. This price is slightly higher than this month’s low of 18,154.
Bitcoin consolidation continues
Bitcoin has gone nowhere in the past few days as its divergence from American equities continued. It has remained slightly below $20,000 even as key indices bounced back. The Dow Jones and Nasdaq 100 indices rose by more than 3% on Monday and Tuesday and then pulled back slightly on Wednesday.
Bitcoin has reacted mildly to the ongoing earnings season. This is partly because most American banks have remained muted about the coin. The only big bank that has been active in the Bitcoin market is Bank of New York, which started custody services recently. Meanwhile, its earnings on Wednesday, Tesla remained muted about its remaining Bitcoin holdings.
Meanwhile, the BTC/USD price remained in a consolidation mode as American bond yields rose. The yield on the 10-year government bonds rose to 4.08% while the 30-year yield rose to 4.08%. This performance is an indication that analysts expect the Federal Reserve to continue hiking interest rates in the coming months.
Bitcoin also wavered as the US dollar index rebounded after falling on Monday and Tuesday. The US dollar index rose by more than 80 basis points to $112.88. Historically, Bitcoin has an inverse relationship with the US dollar.
The US dollar jumped as the volatility index rebounded. It rose by more than 2% to $31 while the fear and greed index remains in the fear zone.
Therefore, with Bitcoin diverging from other assets, it will likely react mildly to the upcoming American existing home sales data.
BTC/USD forecast
The BTC/USD pair remained in a tight range in the overnight session. On the 4H chart, it is consolidating at the standard pivot point. Also, Bollinger Bands have narrowed while oscillators like the Relative Strength Index (RSI) and the MACD continued moving sideways. The price is also trading at the 25-day moving average.
Therefore, it will likely continue consolidating as investors wait for the next catalyst. The next key support and resistance levels to watch will be 18,500 and 20,000.
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