SEC’s crackdown on crypto staking sends shockwaves through the industry as Bitcoin drops below the $22,000 mark, igniting debates on the future of digital currencies. Bitcoin dropped by over $1000, as over $70 billion disappeared from the market in less than 24 hours.
Can Bitcoin recover the lost gains? Here’s this week’s Bitcoin analysis.
Previous Bitcoin Analysis
The previous analysis discussed Bitcoin trading around $24,250 with resistance at that level. A major market-moving event could push the price above the resistance. Otherwise, a retest of the top of the falling wedge could be expected. The 200-day moving average was expected to support and prevent a significant price drop.
The analysis also pointed out two key levels, $25,220 and $31,785, that may provide resistance if the price continues to rise.
Bitcoin Outcome Scenarios at $21,900 Support
Bitcoin is currently retracing after hitting the resistance level at $24,256. The chart presents two scenarios of the outcome of the BTC for next week.
Scenario 1(BEARISH):
Bitcoin is currently sitting at the 200-day moving average – a very key indicator in technical analysis. If it breaks below this indicator, the markets should be prepared for maximum pain. Below it is the 50-day moving average (green). This indicator might act as a secondary support for Bitcoin if it does slide below the 200-day MA. If 50-day MA does not hold, the bears will push the price to $18,800.
The Relative Strength Index (RSI) is also on a downward trend trading slightly below the 50-level mark. This signals a solid bearish week ahead for Bitcoin investors and traders.
Scenario 2 (BULLISH):
If the 200-day MA does hold its ground and bulls move their weight around, BTC might have a run back up to $24,000. Depending on the bull’s power, the rally might break the local resistance that formed at this level, pushing the price to $31k – $32 range. After $24,000 there is little upward resistance until the aforementioned range.
Author’s Note
The SEC and other US government agencies are hawks, eyeing down Bitcoin and waiting for the right time to attack. However, as they wait for the right time to deliver the death blow, they continues to wage small wars against Bitcoin and Crypto. The most recent in this barrage of assaults in the Kraken settlement lawsuit with SEC, the result of which is Kraken shutting down its US crypto-staking service. In addition to that, Kraken paid a $30M fine in the settlement case. In the wake of this verdict, Bitcoin and crypto crash.
The war wages on.
DISCLAIMER: The work included in this article is based on current events, technical charts, company news releases, and the author’s opinions. It may contain errors, and you shouldn’t make any investment decisions based solely on what you read here.