Bitcoin shows more and more trouble defending the $30,000 mark

Over the weekend, the cryptocurrency market was relatively muted. Bitcoin continued to oscillate between $29,600 and $30,350. So far, it has not taken out a low at $29,508 from 18th July 2023. However, it also has not shown signs of stabilizing above $30,000. Therefore, we continue to wait for Bitcoin to either break below $29,508 or hold above the important psychological level of $30,000 (without dipping below it). If Bitcoin breaks below $29.508, it will bolster the bearish odds for the short-term; interestingly, below this level, there is an absence of any significant support until $28,452 (if not counting $29,000). Besides these price levels, we will pay close attention to MACD on the daily chart. Currently, it points to the downside, and if it breaks below the midpoint, it will be a strong bearish signal. The equally bearish will be if RSI continues to develop a bearish structure and Stochastic fails to reverse to the upside (on the daily time frame); the same applies to the convergence between DM+ and DM- (and eventual crossover). Contrarily, a bullish sign will be if MACD, RSI, and Stochastic start rising again, with DM+ and DM- diverging from each other. As for our stance beyond the short term, we continue to believe that a retest of 2022 lows remains a real possibility (especially if the economy experiences a strong recession instead of a soft landing).

Illustration 1.01

Illustration 1.01 displays the daily chart of MACD. If MACD breaks below the midpoint, it will strongly bolster the bearish odds in the short term.

Technical analysis gauge
Daily time frame = Slightly bearish
Weekly time frame = Neutral
*The gauge does not necessarily indicate where the market will head. Instead, it reflects the constellation of RSI, MACD, Stochastic, DM+-, ADX, and moving averages.

Please feel free to express your ideas and thoughts in the comment section.

DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.

Comment:

Yesterday, Bitcoin broke below $29,000. In the process, it fully retraced to its 50-day SMA. Now, we will pay close attention to the Bitcoin's ability to hold above this level; if it fails, it will be bearish. Contrarily, it will be slightly bullish if it succeeds and retraces above $30,000.

Comment:

There has not been any significant uptick in the number of wallets holding 1000 or more Bitcoins in the balance (for the past ten days). In our opinion, that suggests large speculators are waiting for lower prices before entering the market. The risk of more downside remains.