Bitcoin pulls back to support at $16,200 as unrest in China rattles global markets
(Kitco News) - The cryptocurrency and traditional finance markets fell under pressure on Monday as global sentiment is being weighed down by growing unrest in China over the nation’s restrictive zero-Covid policy, which finally pushed citizens to their breaking point on Saturday.
Coming off the long holiday weekend in the U.S., the major market indices trended down throughout the trading day, with the S&P, Dow and Nasdaq all closing in the red, notching losses of 1.54%, 1.45% and 1.58%, respectively.
Data from TradingView shows that despite crypto trading being banned in China, Bitcoin (BTC) was not immune to the pressures exerted on traditional financial markets. The top crypto fell under pressure in the early trading hours on Monday and hit a daily low of $15,993 near midday before bulls bid its price back above $16,200.
BTC/USD 4-hour chart. Source: TradingView
The early morning move lower was discussed by senior Kitco technical analyst Jim Wyckoff in his morning Bitcoin brief, with the analyst noting that “While the BC bulls have stabilized prices since they hit a two-year low last week, the bulls are disappointed BC prices have not seen safe-haven demand amid the China civil unrest over the weekend.”
As a result of the continued weakness brought about by the unrest in China, “BC bears have the overall near-term technical advantage,” Wyckoff warned, while also offering some hope to the crypto faithful by noting that “the recent sideways price action very slightly favors the bulls.”
Sideways until the new year
The weakness seen in Bitcoin over the past two doesn’t bode well for an end-of-the-year rally that many are expecting, according to crypto analyst Michaël van de Poppe, who posted the following tweet highlighting the inability for BTC to breakout above $16,800.
Crucial area of #Bitcoin couldn't break, so we're still consolidating within that range.— Michaël van de Poppe (@CryptoMichNL) November 28, 2022
On support now.
If this is lost, I'd expect new lows to be seen on the markets, probably depending on China & FTX contagion this week. pic.twitter.com/hWp1BF8peB
A failure to hold support here at $16,200 could lead to further downside, according to Poppe.
Insight into what that downside might look like was provided by cryptocurrency analyst Rekt Capital, who posted the following tweet suggesting that the new trading range for Bitcoin is likely to be between $13,500 and $19,500 for the foreseeable future.
When #BTC lost the ~$19500 level as support...— Rekt Capital (@rektcapital) November 28, 2022
It broke down into the ~$13900-$19500 Monthly Range
Monthly Candle Close is coming up soon
A Monthly Close below ~$19500 would likely confirm the ~$13900-$19500 Range as its new playground$BTC #Crypto #Bitcoin pic.twitter.com/qnAdtsI3SY
A few altcoin standouts in a sea of red
While the majority of markets struggled on Monday, there were several crypto projects that managed to buck the trend to post modest gains for the day.
Daily cryptocurrency market performance. Source: Coin360
The top gainers include a 9.19% increase for Braintrust (BTRST), an 8.49% gain for ApeCoin (APE), and a 6.52% gain for Vulcan Forged PYR (PYR).
The overall cryptocurrency market cap now stands at $821 billion, and Bitcoin’s dominance rate is 38%.