Waiting for $40K? Bitcoin's critical level is already here, says new research

Published at: April 8, 2022

Bitcoin (BTC) is at a “pivotal” point and faces macro forces that could influence it for “months to come,” fresh research says.

In its latest market update on April 8, trading suite Decentrader called for more attention to focus on Bitcoin’s “yearly pivot” price.

All eyes on the yearly pivot

After giving $43,000 support two retests this month, Bitcoin has punctured market sentiment having reversed direction near $50,000.

The move below $46,200 — the opening price for 2022 — was particularly hard to swallow, as it had marked the BTC price resistance ceiling since Jan. 1.

As lower levels get revisited, calls for $40,000 or even lower are emerging, but for Decentrader, the zone for bulls to hold is already here. This comes in the form of the yearly pivot, a price level which in 2022 lies at around $43,500 — right by Friday’s spot price.

“Bitcoin was rejected off the Yearly Pivot, a level which has not been broken in either of the last 4-year cycle bear markets,” analyst Filbfilb explained.

“This, although highly probable, was a disappointment for the bulls which had an injection of hopium, having broken the major weekly support/resistance level of circa $43k.”

Should the current scenario truly represent a “bear market” phase for BTC/USD, a close above the pivot, notably on higher timeframes, would not only be bullish but a historically unusual event.

“A break above the yearly pivot would be a break from the 4-year cycle norm and could suggest that Bitcoin will be on the way to significantly higher prices, but for the immediate term, the weekly level needs to be supported by the bulls, to avoid dropping back into consolidation,” Filbfilb added.

Liquidity stacks up

Looking beyond the pivot, the coming months seem firmly tied to central bank policy as inflation bites and steps to combat it intensify.

Related: Bitcoin plumbs April lows as US dollar strength hits highest since May 2020

The United States Federal Reserve’s balance sheet reductions are likely to pressure stocks and risk assets, analysts agree, with Bitcoin thus standing to lose appeal.

Filbfilb agreed on these powerful headwinds, arguing that the Fed’s action could influence BTC price action “for months to come.”

How low Bitcoin could go, however, may well depend on liquidity grabs. Sentiment, shown via  derivatives funding rates, continues to favor upside despite spot price action weakening, raising the chances of a liquidation cascade downwards.

This week already saw the largest long liquidation episode since January, data from on-chain monitoring resource Coinglass shows.

Liquidity both above and below spot price means the potential for a squeeze in either direction remains high, Filbfilb wrote, with the potential upside target still north of $50,000.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Tags
Related Posts
Another $1 billion wipeout: Why is Bitcoin seeing extreme price moves?
Nearly $1 billion worth of Bitcoin (BTC) futures contracts were liquidated on Jan. 13, a day after the big shakeout. The continuous loop of liquidations is causing extreme volatility and large price swings in the cryptocurrency market. What are futures liquidations, and why are so many Bitcoin positions being liquidated? In the Bitcoin futures market, traders borrow additional capital to bet against or for Bitcoin. The technical term for this is leverage, and when traders use high leverage, the liquidation threshold gets tighter. For example, if a trader borrows 10 times the initial capital, a 10% price move to the …
Bitcoin / Jan. 13, 2021
Bitcoin sees record 100 days above $10K as one analyst eyes ‘parabolic’ 2021
Bitcoin (BTC) has officially beaten a new record as BTC/USD trades above $10,000 for 100 days, and major gains should come next. As voting in the United States’ presidential election ended on Nov. 3, Bitcoin saw a landmark moment of its own — 100 days straight trading in five figures. Bitcoin sees record stretch above $10,000 The achievement is not just impressive as a record for $10,000-plus prices. According to previous data, once Bitcoin trades above these significant price levels for 100 days, BTC/USD swiftly increases by an order of magnitude. As Cointelegraph reported last week, the length of time …
Adoption / Nov. 4, 2020
Crypto Markets in The Green, XRP Sees Major Boost Briefly Overtaking ETH by Market Cap
Tuesday, Nov. 6: top cryptocurrencies have seen strong gains on the day, with Ripple (XRP) temporarily overtaking Ethereum (ETH) as the top altcoin by market capitalization. Market visualization from Coin360 Bitcoin (BTC) is up 0.3 percent over the last 24 hours, and is trading at around $6,447 as of press time. Having briefly dipped below $6,400 during the day, BTC has rebounded and is pushing a slightly higher price point. BTC is still down 1.67 percent over the past 30 days. Bitcoin 7-day price chart. Source: CoinMarketCap ETH has seen some growth over the 24-hour period, up 3.64 percent from …
Bitcoin / Nov. 6, 2018
Bitcoin Price Stays Static at $8,800 as NEO, BNB Steal the Limelight
Bitcoin price (BTC) continued its daily trading pattern on Nov. 13, hovering just under $8,800 after losing support at $9,000. Cryptocurrency market daily overview. Source: Coin360 Bitcoin tracks sideways below $9K Data from Coin360 showed another lackluster day for BTC/USD, with little progress over the past 12 or 24 hours. The week had begun with Bitcoin losing its foothold higher up, exiting a trading corridor between $9,000 and $9,500 and so far failing to reclaim it. Bitcoin seven-day price chart. Source: Coin360 As Cointelegraph reported, analysts had remained broadly bullish on longer-term market prospects. Now, however, the short term could …
Bitcoin / Nov. 13, 2019
Bitcoin price reverses gains on New Year's Eve; hodlers continue stacking sats
Bitcoin (BTC) and the broader cryptocurrency market turned lower Friday afternoon, erasing intraday gains to cap off a highly successful year on a weaker note. Market Update The BTC price fell below $46,000 Friday and was last seen hovering below that level, according to data from Cointelegraph Markets Pro and TradingView. The flagship cryptocurrency is down 2.9% on the day to trade at $45,933. BTC's price is down more than 5% from the intraday peak. Altcoins faced a similar downward trajectory as Bitcoin, with the likes of Ether (ETH), Binance Coin (BNB) and Solana (SOL) each falling more than 2%. …
Bitcoin / Dec. 31, 2021