Bitcoin (BTC), the biggest name in the cryptocurrency market, is preparing to close a productive March with a high note. So, will Bitcoin survive the bear market? Here are 5 highlights of BTC, SHIB, DOGE this week…
Bitcoin (BTC) price is fluctuating
Bitcoin price has been fluctuating for the past few months, especially in March. BTC price has been almost stagnant compared to the previous weekend and has maintained impressive stability despite periods of volatility. However, there are growing concerns that the market may struggle to maintain its current levels.
A popular Twitter account called IncomeSharks flagged the decrease in equilibrium volume as a clear sign of momentum, noting that weak OBV at resistance and price should be taken into account along with a lack of demand. The analyst says that in the event of a decline, a new wave of buying demand should be obtained and that big news or other congestion in the markets may be the only way to move up.
Also, popular trader and analyst Rekt Capital agrees that there should be a healthy correction for Bitcoin. If BTC struggles to break above $28,700, a healthy drop may be needed to gain new buyer interest at lower levels. Technical analysis shows short-term weakness and a catalyst may soon emerge to rectify that weakness.
Rekt Capital remains optimistic about the long-term trend, noting that it watches the 200-week moving average (WMA), a critical area where BTC price is predicted to confirm its exit from the bear market. The 200WMA currently sits at around $25,500 giving the bulls room for a modest decline.
Elsewhere, Crypto Tony watches those shorter timeframes. “We have yet to lose $27,700 on a 4-hour timeframe, so doomsday tweets may take a break,” the technical analyst said, pointing to the stabilization of buying and selling pressure in a range between $27,700 and $26,600.
The last days of March will pass with US macro developments.
Unlike last week, the last days of March are unlikely to offer surprises from the US macroeconomic space. That’s not to say that a curveball won’t show up, but the rest of the month will be comparatively quiet in terms of macro data releases.
Also, no surprises are expected in terms of US macroeconomic data in the last days of March. The only exception is the March 31 Personal Consumption Expenditure Index (PCE), which contains important information on US inflation trends, to be released on March 31.
If Bitcoin reacts to unanticipated PCE data, the results could lead to a volatile weekend a day before the monthly close. In addition, new developments regarding the banking crisis may increase the uncertainty.
Fed rate policy
Since the Fed has raised interest rates despite the crisis, it is following a divergent path on interest rates and says more increases are possible. However, markets take the opposite view due to the stress caused by previous rate hikes.
In the latest issue of its March 26 series of updates, analytics platform Mosaic Asset, “The Market Mosaic,” explained, “Tighter financial conditions and continued bank stress are the main reasons the market believes the Fed will have to abandon its plans.”
Mosaic also pointed out that risky assets have performed worse in the past immediately after the announcement of the transition to rate hike policies. In their analysis, “If the central bank stops its rate hike campaign, it will show that there is a concern that the central bank is breaking something in the capital markets. “But the Fed has a track record of only adjusting policy when things are too late,” he said.
He also added, “This is why bear markets in the past have had the biggest stock market declines since the Fed stopped or cut interest rates.”
BTC investors lay the groundwork for supply shock
It seems that Bitcoin hodlers broke new records under the current conditions and laid the foundations for the supply shock in the process. According to the latest data from on-chain analytics platform Glassnode, the amount of BTC supply that has not left its wallet for two years or more is now at ATH.
As of March 27, more than 52.5% of all mined BTCs have not moved since March 2021 and their holders have not sold or transferred during the bull market.
Likewise, the number of whales holding 0.1 BTC or more is breaking new records during the day. Similarly, the number of wallets with a non-zero balance is higher than ever, rising to 45,388,865 as of March 27.
Exchange Bitcoin reserve metrics
Adding to an existing narrative of what will happen in the next wave of BTC price movements, these numbers provide an idea of what impact BTC will have on price movements in the next wave of mainstream consumer interest.
With so much supply being placed in cold storage, any increase in demand for BTC could make one realize that one of the world’s toughest assets is already very scarce. According to Glassnode, the total BTC balance held by major exchanges remains close to the lowest level in the past five years.
What does historical data say about BTC?
For some, BTC price movements are repeating past cycles, reaching a new ATH level in the process. Some, like Tedtalksmacro, point out that the timing of the multi-year lows of November for BTC/USD is more or less perfect.
Since then, a rally that started in January has continued, with no signs of new macro lows yet to break the November 2022 low of $15,600. Referring to a special thread on Bitcoin’s performance on March 27, Tedtalksmacro wrote, “390 days until the next BTC halving cycle.”
The price of BTC is following the historical pattern, bottoming out 400 days before the halving cycle. Popular reviewers like Tedtalksmacro also consider halving cycle timing when it comes to price.
Last month, Rekt Capital predicted that the next level of ATH will be in about 18 months. He explained that, based on history, BTC takes about 900 days from the Downtrend boom to the Bull Market peak. If history repeats, BTC is expected to hit its bull peak in the summer of 2025.
Market sentiment index shows investors remain ‘greedy’
Like last week, a potential hurdle to Bitcoin’s bull run comes from investors. Although there has been volatility due to the Fed rate hike and BTC not being able to get any closer to $30,000, Bitcoin has the market sentiment last seen in late 2021.
According to the crypto fear and greed index, “greed” currently characterizes market sentiment across the crypto market. On March 21, the index’s score reached 68/100, its highest level since November 2021, and has continued to hover around the mid-60s since then. While the index is nowhere near “extreme” levels, the higher the index rises, the greater the likelihood of a market correction.
cryptocoin.com In this article, we have included the technical analysis of Bitcoin in shorter time frames. The leading crypto is spending less than $27,000 at the time of writing, down 3% daily.
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