Bitcoin is not out of the woods yet as technical indicators show the asset might crash anytime. At this point, traders can only practice extreme caution while trading or exit the market all together. Our previous hunch of a black swan event on Dec. 20, 2022 proved to be false – or is it?
Let us dive into this week’s Bitcoin price analysis.
Previous Bitcoin Price Analysis
Last week’s analysis saw Bitcoin threaten to rise slightly as a result of the good CPI data. The breakout was unexpected and the asset rallied to around $18,357 after which it crashed hard towards the close of the week. Eventually, BTC closed the week at $16,781. Was it a scam pump? Of course it was.
Bulls got caught completely with their pants down and got over $270M in Longs liquidated between Dec 14 and Dec. 16, 2022.
Market Outlook for Next Week
For the longest time in the crypto space, cryptoassets usually crash on weekends and then recover throughout the following week. Experts in the space have attributed this to less volumes, and margin calls due to banks being closed for the weekend.
While this might be true, this unseemingly coincidental occurrence of events creates a favorable environment for Market Makers and Smart Money to move the market in their favor.
The incoming weekend coincides with the Christmas holiday. If volumes are low during normal weekends, then you can expect they will be even lower during this one. Will it be the perfect time for Smart Money to crash the market? Let’s see in the charts.
There are two scenarios that could play out moving on from here. In the first scenario, BTC price, which is currently below (and struggling to break) the 21-day moving average, can crash below the strong support (pink band) (1).
The second scenario is a move higher above the 21-day MA in a fake-out fashion before hitting the local resistance at 16,962 and heading back down below the strong support (2). Both scenarios are bearish and are likely to happen during the weekend. What better way for Smart Money to ruin people’s christmas? The levels to look out for as we move down are $16,242, $15,631, $10,228 and $8,036.
If we break below $15,500, you want to begin buying the dip as this could be the last crash before we begin a new bull market.
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 decision based solely on what you read here.
Vincent Munene is a freelance writer and a great blockchain enthusiast. Blockchain has changed his life in terms of financial freedom and in return, he likes to educate people and keep them up to date on everything blockchain. He is a Biochemist by profession and also loves to play the piano.