The crypto market settled into a holding pattern on May 25 after traders opted to sit on the sidelines ahead of the midday FOMC meeting where the Federal Reserve signaled that it intends to continue on its path of raising interest rates.
The Fear and Greed Index is exhibiting its longest run of extreme fear since the market crash in Mach 2020. Latest price action for Bitcoin has continued to compress into an increasingly thin trading range, but technical analysis indicators provide least insight on what direction a possible breakout could take.
Bitcoin broke through $29.4K and ran towards the next resistance zone. If we hold $29.4K, we’ll be good towards $32.8K. One interesting thing to note at these price levels is that while the predominant sentiment is that of extreme fear as whale wallets have taken this as an opportunity to accumulate some well-priced BTC.
As Bitcoin continues trading around $29.6K, the amount of key whale addresses (holding 100 to 1k $BTC) continues rising after the massive dumping from late January. Still, $BTC is believed to have the potential to make breakdown from the Macro Range Low support & continue its drop to complete -43% downside. The -43% mark is confluent with the 200-Week MA at ~$22500.
The importance of the current price level for Bitcoin was touched upon by economist Caleb Franzen, who posted the following chart looking at the long-term performance of BTC versus its weekly anchored volume-weighted average price (AVWAP) noting that “This is a pivotal retest, similar to the dynamics in March 2022.”
A rebound on the weekly AVWAP from the COVID low could increase bullish probabilities. A breakdown below it would drastically increase bearish probabilities, foreshadowing a retest of the grey range, $13.8k-19.8k. The overall cryptocurrency market cap now stands at $1.265 trillion and Bitcoin’s dominance rate is 44.8%.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
Home / Market Update / Cryptocurrency / Fears grabble Bitcoin price, but signs of a potential reversal exist
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