Bitcoin’s short-term momentum is currently clouded with uncertainty as traders and investors eagerly await the SEC’s decision, now expected by January 10th. The outcome of this decision will have a significant impact on the cryptocurrency’s price and the broader cryptocurrency market.
Traders and investors are particularly attentive to how Bitcoin will react to key price levels. A move beyond $41,000 could signal a bullish trend, while a dip below $35,000 might suggest further declines. However, current weekly charts indicate potential downturns, with Market Reversal Indicator (MRI) sell signals and Swing Failure Pattern (SFP) indications emerging, hinting at possible reversals from recent highs.
On-chain metrics observed since October 25th add to the cautious outlook. There has been a decline in daily active addresses and Social Dominance, pointing to underlying market weaknesses that contrast with Bitcoin’s recent price surge. Additionally, the increasing price juxtaposed with declining Market Value to Realized Value (MVRV) ratios highlights vulnerabilities in Bitcoin valuations that investors are closely monitoring.
Technical analysis further supports the bearish sentiment, with the presence of a weekly bearish breaker ranging from $28,000 to over $41,000. This reinforces predictions of a bearish trend as Bitcoin balances near a weekly Fair Value Gap (FVG) of around $37,000. There is even the possibility of forming a lower low beneath $24,000, which threatens the optimistic narrative for Bitcoin in 2023. However, there is still hope for the bulls. If support at the psychological level of $30,000 holds firm, it could potentially trigger another bull run aiming for resistance near $46,000.
Investors are advised to closely watch these developments as they may significantly impact Bitcoin’s price and the broader cryptocurrency market in the coming weeks and months. The outcome of the SEC’s decision will be a key factor in determining the future direction of Bitcoin and the overall sentiment in the cryptocurrency market.