Bitcoin is still traversing sideways and slightly down, and this is the tenth day of such price action. Strong support is holding the price above $67,000 and it would seem that it’s only a matter of time before bitcoin makes that sudden thrust upward that could take everyone by surprise.
Sideways and downwards
The statement “Markets can remain irrational longer than you can remain solvent” is an adage attributed to John Maynard Keynes, and could be applied to the present price action in bitcoin.
Bitcoin has been travelling sideways and slightly downwards, not just for the last ten days, but also since bitcoin made its all-time high on 14 March. For investors who may not be used to markets, this last couple of months might have seemed like an age, and many of them may even have sold, especially when bitcoin plumbed the local depths down as far as $56,600.
Price structure is being built
What has been happening to bitcoin over these last couple of months is certainly par for the course, and what’s more, it is helping to build price structure around the level of the last bull market high of 2021. This price structure can then be used as a firm base from which bitcoin can launch its assault to the next higher level.
Source: TradingView
As can be seen in the weekly chart above, good support levels have now formed below the $BTC price, and as the king of the cryptocurrencies moves sideways it is continuing to build that important structure.
Inflation causing concern
One might have thought that bitcoin would have already started its next push up. However, with inflation again starting to cause concern, the Federal Reserve is more likely to keep interest rates where they are, and if things worsen, even perhaps raise them.
In a high interest rate environment, and one where liquidity is being kept tight, bitcoin could find it difficult to really get a head of steam up. Liquidity is what drives all assets up, and without it there is more chance that risk assets such as bitcoin will just continue to bide their time and traverse sideways.
A right-translated cycle?
Could it be that instead of the left-translated bull market that many have discussed across social media, we may be looking at a right-translated bull market – one that extends the typical bitcoin bull market of around 3 years out even longer?
This is perhaps a possibility. However, looking at the indicators for the current price action, it rather looks as though the next bitcoin rally will begin soon. It’s just a matter of time.
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.
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