Bitcoin Facing Significant Resistance – Is De-Risking in the Cards?
Bitcoin's (BTC) ascent that began at the start of 2023 has stagnated recently raising questions as to whether the rally is sustainable.
Upward momentum is running out near crucial technical resistance.
Bitcoin faced resistance at $24,000 and lost some ground. A similar bull failure was seen above $24,000 in August last year.
Bitcoin is increasingly looking like it predicts risk sentiment among seasoned traders for other risk assets. The world’s largest cryptocurrency by market capitalization has led significant tops and bottoms in the S&P 500 by days or even weeks.
Stocks, bonds, and cryptocurrencies have rallied in the past few weeks, while the U.S. dollar fell in hopes that the Federal Reserve (Fed) would pause interest rate hikes in May and cut rates later this year.
The Federal Reserve will likely raise rates by 25 basis points to a new range of 4.5% to 4.75% today. Some analysts are of the opinion that Fed President Jerome Powell will push back against market expectations during the post-rate decision press conference, putting downward pressure on risk assets.
There is uncertainty that could affect risk appetite. The lack of clarity about future FED decisions creates unease in many, which makes markets unpredictable.
Tone Vays weighs in on the short-term
Tone Vays has doubts that Bitcoin (BTC) will continue upward in the short term despite the crypto asset’s sizeable January gains. He thinks BTC will face resistance at the $25,000 mark.
“Once we get close to $25,000, there’s a very high probability of rejection… We do have room on the [momentum reversal indicator].”
Vays warns about serious resistance that will not be easy to break.
Understanding the Momentum Reversal Indicator (MRI) for Bitcoin Price Movements
The MRI is a tool for analyzing potential changes in the direction of Bitcoin’s price movements.
By combining measures of momentum and volatility, the Momentum Reversal Indicator helps traders and investors identify possible trend reversals in the market.
It is important to note that while the MRI can provide valuable insights into market trends, it should only be relied upon partially.
By utilizing the Momentum Reversal Indicator alongside other tools, traders and investors can better understand Bitcoin’s potential price movements and make informed decisions accordingly.
Andrey Kunev
Reporter at CoinsPress
Andrey Kunev is a knowledgeable cryptocurrency content creator passionate about the crypto market. With extensive experience in market analysis and investment reporting, Andrey is a valuable asset to the CoinsPress team. As a frequent contributor, he offers insightful and comprehensive coverage of market trends, price fluctuations, and new advancements in cryptocurrency. Whether you're a seasoned investor or just getting started, Andrey's clear and concise writing offers a comprehensive look at the current state of the crypto market and its prospects. Stay up-to-date with CoinsPress's expert analysis and commentary on all things cryptocurrency.
