The BTC/USD pair will likely keep falling as bears target the support at 17,000.
Bearish View
- Sell the BTC/USD pair and set a take-profit at 17,000.
- Add a stop-loss at 22,000.
- Timeline: 1-2 days.
Bullish View
- Set a buy-stop at 20,500 and a take-profit at 22,000.
- Add a stop-loss at 18,000.
The BTC/USD pair remained solidly below the important support of 20,000 during the weekend as sentiment waned. Demand for Bitcoin and other risky assets has also struggled as investors price in a more hawkish Federal Reserve. It is trading at $19,100, which is about 41% below the highest point in June this year.
Bitcoin Demand Wanes
The BTC/USD pair has declined sharply as investors worry about the cryptocurrencies industry. There have been important news from the sector. For example, in June, Celsius, a leading cryptocurrency bank announced that it was suspending deposits and withdrawals. The company attributed this situation to the significant pullback of all cryptocurrencies.
Last week, Three Arrows Capital announced that it was filing for bankruptcy. This happened as the company faced significant margin calls from leading exchanges. As a result, this made it the biggest crypto-focused hedge fund to go under. The company lost most of its money when Terra and its ecosystem crashed.
Meanwhile, in a statement, Voyager Digital, a major cryptocurrency exchange, announced that it was suspending withdrawals and deposits. The company is now raising capital to save its business.
Another major news was that BlockFi, once valued at over $4 billion was being acquired by FTX for about $25 million. Without the bailout, the company would have probably gone bankrupt.
Therefore, the BTC/USD pair has dropped sharply as investors continue worrying about their holdings. Most of them are worried about whether their exchanges will be next to suspend withdrawals and deposits.
At the same time, there have been significantly low buyers of cryptocurrencies. Recent data shows that the number of people creating accounts with exchanges has been in a strong downward trend. Volume of Bitcoins traded has also fallen recently. All this happened while the US dollar has maintained a bullish trend.
BTC/USD Forecast
The four-hour chart shows that the BTC/USD price dropped sharply in June. Shortly afterwards, the pair bounced back and retested the key resistance at 21,888, where it struggled to move above. It has now been retreating and is trading at 19,110, which is slightly above last month’s low of 17,623.
The pair has also moved below the 25-day and 50-day moving averages. It has also moved between the first and second support levels of the standard pivot points. Therefore, the BTC/USD pair will likely keep falling as bears target the support at 17,000.
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