Two days of red candles for bitcoin and the altcoins has perhaps put the jitters into investors. Are we at the top or is there another leg to go?
A nervy market awaits the next move. Bitcoin wicked down to the strong $22,300 support on Wednesday but came straight back up to rest at $22,600.
Bitcoin is still in the sideways range between $22,300 and $24,300. As long as it continues within this range all is probably fine at least for the short term.
All waiting on bitcoin
A move from bitcoin to the upside would likely trigger the final altcoin pump and so that is what the market is waiting for. Obviously, the other side of the coin to this is a bitcoin breakdown, which could lead to a cascade of far more epic proportions in the alts.
Current outlook is positive
The risk environment for bitcoin doesn’t look too bad. The DXY Dollar Index has been rejected from the 103.5 level and is hovering at 102.9. It could probably be imagined that the breakdown will continue to the 101.5 level, but of course everything is based on probabilities.
USDT Dominance has touched the top of a channel it has been in for almost 3 weeks and which it is respecting perfectly. It is also sitting on a trendline from December 2021, as well as a strong support at 6.48%.
Bitcoin Dominance has reentered the top of an upwards slanting channel and is also holding strong support at 43.20%. A break here would see a continuance of the downward trend, and allow the alts to break loose once again.
Something needs to break
All in all, the market is at an important juncture right now. A strong break in either direction could very possibly be decisive in setting the next trend. If it is to the upside then it may not be for too many more days as bitcoin will come up against the $24,300 resistance and would face very strong resistance, perhaps leading to a larger correction.
However, should the break be to the downside, then it might be expected that bitcoin takes a bit of a plunge, dragging the altcoins down with it. Of course, in the grand scheme of things this would all contribute to a more stable base, allowing price structure a longer period to solidify and giving investors more confidence in the next move upwards.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.