Bitcoin (BTC) started to rise hours before the decision to increase the interest rate on the evening of December 14. Technical analysts warn of short-term bottoms as BTC price hovers around 1-month highs.
Scott Melker says getting to the bottom of Bitcoin price is a process
“It is usually a multi-month process,” Scott Melker said in a recent podcast about Bitcoin bottoms. He also added that the decline could take longer than that. Earlier in the interview, Melker highlighted potential signs that Bitcoin is bottoming out in sentiment. It also evaluated the mainstream factors that could keep BTC down. He then pointed to the charts, talking about what he was looking for that might say Bitcoin and crypto are back.
“Obviously, we are here in a series of price lower highs and lower lows, and when that series is broken, you have a technical break in the bear trend and your transition into a bull market. Currently, I believe the last low is around $25,200. So even to start talking about a bull market, this level needs to be broken effectively,” he says.
The analyst also talked about other possible prices and chart movements that people can look for that could signal a change of course towards a bull market. “But when it comes to sentiment, it will be pretty clear when prices start to rise,[people]stop reacting to bad news, and people start to get interested again,” he added.
Maybe we’ll start to see better news, but if we see a real bull run, inevitably most people won’t believe it. They won’t think it’s really happening. It will be $25,000, $32,000, $40,000, and then wherever these people start buying, it will likely be the local peak.
Dave the Wave says the fall is over now
Another well-known analyst shared that he based his prediction on an indicator. Accordingly, it implies that Bitcoin is already experiencing the worst of the bear market. The expert shares that he closely follows the moving average convergence divergence (MACD) of Bitcoin, a momentum indicator for whether there is a change in trend. The weekly MACD for Bitcoin continues to trade above a support level that previously marked the end of bear markets in 2015 and 2018.
Based on BTC’s MACD, the expert believes that the worst is now over. According to Dave the Wave, emotion wobbles chaotically from depression at the bottom to enthusiasm at the top. Also, technical analysis helps smooth out these swings.
He also predicts that Bitcoin will rally to $19,000 after breaking the $17,300 resistance. This prediction came after the Bitcoin price surpassed $17,300. $17,000 is a key support level for BTC. Now, if the bulls can hold their positions above this level, additional upward momentum will be ready. During the same period, the present value of the RSI was 66. This indicates that the market is still in the overbought zone. Currently located above the zero line, the MACD is showing an uptrend.
Arthur Hayes identifies Bitcoin’s catalysts for the 2023 rally
Former BitMex CEO identified the catalysts of Bitcoin in his new statements. He said a bleak macroeconomic backdrop will cause the Fed to finally ease monetary policy next year. Hayes says next year could be a turning point for the Fed because the treasury market and investment-grade corporate bond market could become “dysfunctional.” He then explained what he meant by these becoming ‘non-functional’:
You have a lot of supply without a buyer. The Fed does not buy, the Treasury does not – in fact, they are issuing papers. All major foreign, non-US governments are mostly net treasure sellers, so it would be Japan and China… Middle Eastern countries see their oil not in dollars but at least the dollar’s lowest recycling, less treasury purchases, and yet it’s also reaching an all-time high. If you’re seeing debt issuances because baby boomers in the US are getting old.
Hayes also said there could be a recession while talking about tensions between Russia and Ukraine. He believes the treasury market is effectively telling us that there will be a recession next year, since the quarterly, 10-year gap, which many economists see as a real signal of recession, turned negative.
Talking further about the solution, he said more money needs to be printed to maintain the social safety net. According to him, the politics of the corporate bond and treasury markets will require the Fed to at least stop injecting money into the market, and at most to begin this next year.
Benjamin Cowen says the second longest Bitcoin bear market is over
The widely followed crypto analyst voices bullish prospects for Bitcoin in the coming months. In a new video, Cowen says Bitcoin could reverse its bullish trend ahead of its planned halving to 2024 and the possibility of the Fed easing monetary policy:
Again, my guess is that things will slowly start to turn around and be neutral sometime in 2023. Then come 2023, I predict we’ll start to see some bullish signs as the halving will be in and possibly back to a more dovish Fed.
Current price action, to the crypto analyst, is the second longest bear market in Bitcoin history. However, Cowen says that if Bitcoin drops below its two-year low of around $15,476, it will be Bitcoin’s longest bear market in a matter of days:
It remains the second longest bear market ever because from November 2013 to January 2015 there was actually a bear market that lasted 406 days, meaning the bear market will end in five days. So, if Bitcoin hits a new low five days from now, that would actually be the longest bear market we’ve ever had in Bitcoin history. But if this (~$15,500) bottom is, it’s currently the second longest bear market.
Charles Edwards explains why slowing US inflation is crucial to the macro cycle
The seasoned analyst and on-chain researcher shared his forecasts on inflation dynamics in the US on Twitter. He is confident that inflation is peaking and markets are approaching a U-turn. Edwards says that for the first time in more than 50 years, the United States can see the change in the money supply (the amount of USD in circulation) negatively. Therefore, the economy is on its way back. The analyst shared the chart of the S&P 500 index, a stock market index that tracks the performance of the 500 largest companies traded in the US. The 12-year rally of the S&P 500 ended in 2022.
Commentators on Edwards’ statement argued that the market will see some rate hikes by the Fed before the pivot is capped. The analyst emphasizes that the inflation indicator is left behind. Therefore, the real inflation peak may have been recorded a few months ago, just like the S&P 500.
Edwards also recently shared a series of predictions that show that the bottom of the Bitcoin price has already been reached in this bearish cycle. For the most part, this can be evidenced by lower selling pressure and an increased rate of BTC adoption by retail owners.
Crypto Ed says we’re at an important stage
“We are at a very important stage today with the arrival of the FOMC,” another technical analyst said in his new tweets. Crypto Ed warns, though, that an upside reversal for the US Dollar Index, coupled with a gradual decline in equities, will dampen the enthusiasm of Bitcoin bulls. “A parse would be nice, but unlikely,” he adds.
Meanwhile, Michaël van de Poppe was generally more optimistic about BTC. He recently wrote:
Markets fell from $20,000 to $15.6k due to the FTX crash. We are currently trading at $18,000, just above the June low. I understand the bearish thesis, but this is honestly a sign of strength for Bitcoin.
Prior to that, Van de Poppe had set targets as high as $18,300. Accordingly, $17,200 needed to be sustained as support.
$12,000 waiting on the sidelines for Bitcoin
Traders including Crypto Tony and Capo acted unusually as events turned bearish. For Crypto Tony, a trip as low as $10,000 is “not out of the question yet”. However, Crypto’s Il Capo gave a candid prediction of an imminent capitulation. He commented “Simple” with a chart giving $12,000 as the support zone to moderate the decline.
cryptocoin.comAs you follow, Bitcoin lost $18,000 again on the night of December 14. It currently finds support near $17,300 for its gradual decline.
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