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Bitcoin’s Price Metrics Hint at 5% Swing Amidst Battle

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In the fast-paced world of cryptocurrency trading, Bitcoin is currently embroiled in a fierce battleground as opposing forces of bulls and bears fight for dominance within a sideways market. As highlighted by a prominent trader, Daan Crypto Trades, this ongoing struggle has become a central theme in the crypto sphere.

In his latest analysis shared on X (formerly Twitter) on August 11, Daan Crypto Trades drew attention to a critical level that Bitcoin must reclaim as a foundational support for its price. Despite repeated attempts at breakouts, both the bullish and bearish sides find themselves locked in what can only be described as a “strongly contested” range, according to Daan Crypto Trades’ summary.

This market turmoil is the culmination of a series of fluctuations in the Bitcoin price, with the midpoint of the current spot price range emerging as a pivotal level for observers to monitor closely. This status quo has been largely sustained since mid-June, with the price at approximately $28,500 providing fundamental support and the $31,800 mark acting as a resilient resistance point.

For the bullish camp, gaining control over the $29,700 region is of paramount importance. This maneuver could potentially generate the necessary momentum for a transformation in the market landscape. Daan Crypto Trades made it explicitly clear that the range between $29.5K and $29.7K is hotly contested by both bulls and bears, thereby signifying its significance as a focal area to watch attentively.

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Source

Visually representing these dynamics, an accompanying chart displayed the BTC/USD pair’s ongoing struggle to ascend beyond the range’s lower boundary. Notably, there are few historically significant support lines between $28,500 and $29,500, implying the potential for increased volatility within this range.

Interestingly, this analysis aligns with other viewpoints put forth in recent weeks. Several other experts have also emphasized the significance of the $28,500 price point, or even slightly lower levels, as potential downside targets.

Bitcoin’s Short-Term Spotlight: Intense Mid-$29K Zone Activity

Zooming in on short-term developments, another trader named Skew emphasized the intense activity within the mid-$29,000 zone for Bitcoin. On August 11, exchange trades unveiled substantial bids that successfully absorbed selling pressure. Despite holding above various exponential moving averages (EMAs), the spot price action on four-hour timeframes was characterized by Skew as “weak.”

This scenario has led to what Skew described as “tight price compression.” Such circumstances often precede notable price reactions, hinting at the potential for a price swing of more than 5% in the near term.

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Source: TradingView

As Bitcoin remains locked in this titanic struggle between bulls and bears, market participants and observers alike hold their breath, awaiting a decisive move that could set the tone for the cryptocurrency’s trajectory in the coming weeks.

Current Cryptocurrency Bear Market A Glimmer Of Hope: Top Analyst

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While most of us fear the bear market, here’s a top cryptocurrency analyst who believes otherwise.

The global digital currency ecosystem is currently going through a large negative correction after having a fantastic start to the week. According to information from CoinMarketCap, the total market capitalization has decreased by 3.06% to $1.10 trillion as of this writing. A 3.68% decline in the price of Bitcoin (BTC), which put the most valuable cryptocurrency at $24,073.41 per unit, contributed to this negative collapse. The worst performer among the top 10 cryptocurrencies was Polygon (MATIC), which saw its value fall by 8.43% to $1.35. Ethereum (ETH) also saw a loss of 3.63% of its value to $1,642.19 in value.

Despite how bearish the market appears to be, leading cryptocurrency analyst Ran Neuner noted that when compared to the larger U.S. stock market, it is actually highly positive.

The Dow Jones Industrial Average has lost nearly 697 points in what appears to be one of its worst day closures since the year’s beginning, while the tech-heavy Nasdaq Composite Index is down by 2.50%.

While the cryptocurrency fall is worrying, it is simply a reflection of the highly connected financial sector. The larger market is still registering different outlooks over inflation.

Could Cryptocurrency Critics Be Right?

The ideal market cycle frequently has highs and lows, and in the opinion of the industry’s supporters, this is simply a normal correction.

Yet, according to detractors like Peter Schiff, this could signal the beginning of an approaching reversal of all the advances the sector has made since the demise of the FTX Derivatives Exchange. It won’t come as a surprise to see outspoken detractors like Jim Cramer urge his followers to sell their investments at the right time to cut their losses.

In a recent tweet, Bitcoin’s arch-enemy Peter Schiff projected that the largest cryptocurrency’s price would once more fall below $18,000.

The investor has claimed time and time again that Bitcoin’s growth is solely the result of speculation, downplaying its technological advantages. The business is accustomed to shocks, and the most recent historical tendency indicates that the current decline will only last a short while.

Crypto Exchange Bullish & SPAC Call Off Their Merger, After 18-Months Of Intense Efforts

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On December 22nd, Cayman Islands-based crypto exchange Bullish and the special purpose acquisition company, Far Peak Acquisition Corporation disclosed their mutual decision to end their intended corporate merger.

Bullish and Far Peak signed a corporate merger agreement on July 8th, 2021. Due to this business combination, the exchange would start trading on the New York Stock Exchange.

The exchange was established as a division of Block.one, the software firm that created the open-source blockchain platform EOSIO, last year. Initial investments of $10 billion were made by the software firm and several prominent investors.

That agreement has experienced delays and had its termination date moved from July 8th to December 31st due to overall market volatility, notably in the SPAC and crypto markets. 

However, when the two companies first agreed to join in July 2021, they reserved the right to dissolve the merger agreement if it couldn’t be completed by the end of 2022.

After 18 months of intense negotiations, both Bullish and Far Peak have concluded that it would not be possible for Bullish’s previously filed registration statement on Form F-4 to become effective before year-end. It means there won’t be enough time before December 31st for them to hold a meeting to vote on “the proposed business combination.”

Bullish & Far Peak Ends Deal, Citing SEC’s Work

Chairman and CEO of Bullish, Brendan Blumer, said

Our quest to become a public company is taking longer than expected, but we respect the SEC’s ongoing work to lay new digital asset frameworks and clarify industry-specific disclosure and accounting complexities.

He continued by expressing his satisfaction with the hardworking group of Bullish advisors and workers who have spent countless hours ensuring the company upholds the most significant standards of accountability and transparency.

Whereas Thomas Farley, the chairman, and CEO of Far Peak, expressed regret for not being able to present the Bullish deal to Far Peak shareholders. He added that the achievements of Bullish since its start had exceeded their expectations, and their daily trading volumes demonstrate their impressive growth.

According to his statement:

I am a big believer in Bullish’s talented team, their vertically integrated approach to exchange liquidity, and their unwavering commitment to regulation, and the highest standards of industry transparency.

However, the press release further asserts that due to time restrictions and current market conditions, Far Peak will not be looking for a new merger partner and will instead concentrate on dissolving either on March 7th, 2023, or earlier if possible.

Related Reading |  FTX Files Motion to Control SBF’s $440M Robinhood Shares

JPMorgan’s Bitcoin Flip Complete With a Bullish Report

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JPMorgan Chase, the largest bank in the United States and once the biggest critic of Bitcoin, now seems to have completely changed its mind. Besides, JPMorgan’s Bitcoin flip seems to be sitting well at the price of the world’s leading cryptocurrency. Bitcoin is on the rise again and has already added about $200 after dropping to $9,000 price level recently.

In the past, Jamie Dimon, CEO of JPMorgan Chase, labeled Bitcoin a fraud. Damon also described the obsession in BTC as a tulip bulb. However, it appears that the large financial institution is switching its stance towards the world’s top virtual asset by market capitalization.

 

JPMorgan Chase vs. Goldman Sachs

According to a new report published by JPMorgan Chase, the bank’s researchers describe Bitcoin as ‘mostly positive,’ stating that it has ‘longevity as an asset class.’ This is the complete opposite of what JPMorgan’s huge rivals, Goldman Sachs noted in their latest clients’ call for bitcoin and gold. According to Goldman Sachs, bitcoin is a poor investment, adding that BTC is not in any way, shape, or form an asset class.

The report by JPMorgan read:

“Though the [bitcoin] bubble collapsed as dramatically as it inflated, bitcoin has rarely traded below the cost of production, including the very disorderly conditions that prevailed in March.”

In March, the price of Bitcoin came tumbling down, resulting in the flagship cryptocurrency losing about 70 percent of its value. A month before the March crypto market crash, Bitcoin was trading well above the $10,000 mark. A few weeks later, the price dropped significantly to slightly hit the $3,000 price level, heartbreaking many investors across the world. Many traders and investors were wondering whether 2018 was being replicated all over again.

Nevertheless, this wasn’t the case this time around. Within thirty days, the top cryptocurrency had managed to recoup almost all it had lost with its price action; slightly reaching the $10,000 mark in both May and June. Those quick reflexes to regain a 70 percent loss amid an economy ravaging pandemic should not be downplayed.

What next after JPMorgan’s Bitcoin flip?

The latest report is another step towards a longstanding JPMorgan’s Bitcoin flip. In 2019, reports surfaced that the financial institution provides banking services to some of the largest cryptocurrency exchanges in the United States, such as Coinbase and Gemini. The report further states that:

“There is little evidence of run dynamics, or even material-quality tiering among cryptocurrencies, even during the throws of the crisis… [Bitcoin] price action points to their continued use more as a vehicle for speculation; than a medium of exchange or store of value.”

Here’s Why $20,000 Bitcoin is Still a Distant Dream in 2020

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The community is split right in the middle with Bitcoin at the moment. Over the past few weeks, the largest digital asset has failed multiple times to breach $10,000 and certain market analysts indicated that BTC might falter under falling buying pressure.

Regardless of that, Bloomberg’s long-term outlook for Bitcoin remained completely bullish. According to Bloomberg’s June 2020 edition of Bloomberg Galaxy Crypto Index (BGCI), the company expected that asset to re-test its all-time high valuation of $20,000.

That is a relatively big ask for Bitcoin considering the asset has yet to rally past its yearly high of $10,500. BTC also has immediate resistance at a yearly high of 2019 at $13,800, which should be its current long-term target.

However, Bloomberg’s Mike McGlone analyzed the market a little differently than the rest of the industry. McGlone suggested that due to the COVID-19, the maturation rate of Bitcoin has accelerated which has led to the ever-increasing appetite of the institutional investors. He believed that Grayscale’s intent and action in terms of accumulation of more than 25 percent of the BTC supply in 2020 stands true to that fact.

Is $20,000 attainable at the current rate though?

Without attempting to rain on Bloomberg’s parade, it is important to note that we currently reside in an ever-changing environment went it comes to the larger financial landscape.

To be fair, Bitcoin has a strong chance of breaching 2019’s yearly high of $13,800. A consistent position between $8500-$10000 over the last month are clearly indicators that a bottom at this range might be strong enough as well in the future.

Hence, considering its next bullish cycle starts during Q3 2020, with the possibility of the world economy becoming more stable, it will be hard to argue that strong bullish momentum would easily push the asset above the $13,000 mark.

However, as observed since 2019, Bitcoin does not pump like 2017 anymore. A sudden jump of thousands of dollars has been a rare occurrence, and even though the valuation jumped 178 percent from April 2019-June 2019, over the next 6 months, we saw the asset shaved 50 percent of its valuation.

Now, many people in the community criticized such retracements but it is actually a healthy sign when the price corrects itself after a huge plunge.

From an on-chain point of view, the utilization has dropped down significantly as well.

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The above chart indicates the number of unconfirmed transactions in the BTC mempool. As observed the total number of unconfirmed transactions has been going down since the halving ended. Although it appears positive on the surface, it also indicates that users were no longer using the chain as fervently as before the halving. Less congestion equals to less unconfirmed transactions.

Hence, it becomes incredibly difficult to sustain a bullish rally that will not be backed with fundamental metrics.

Therefore, at press time it won’t be a wise bet to pinned down all your hopes on Bitcoin to reach $20,000. At least not at the moment, when the market is still trying to find its bearing back.