Bitcoin holds firm as analysts warn of pullback to $32k
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(Kitco News) - The crypto market trended higher on Monday, bolstered by the election of a Bitcoin (BTC) friendly president in Argentina, who is staunchly opposed to the central banking system and wants to get rid of the Argentine peso in favor of the U.S. dollar.
Stocks also saw gains to start the shortened holiday week as investors continue to interpret the latest inflation data as a sign that the Federal Reserve is done raising interest rates. The CME FedWatch tool shows that traders are now pricing in a 30% chance that a rate cut could come as soon as March.
At the market close, the S&P, Dow, and Nasdaq all finished higher, up 0.74%, 0.58%, and 1.13%, respectively.
Data provided by TradingView shows that Bitcoin broke above $37,000 on Sunday after Javier Milei became President-elect in Argentina, and continued to rise in trading on Monday despite the lack of a spot BTC ETF being approved. At the time of writing, BTC trades at $37,530, an increase of 1.4% on the 24-hour chart.
BTC/USD Chart by TradingView
Sunday’s rally led to a rise in the futures market as “November Bitcoin futures prices [were] firmer in early U.S. trading Monday,” according to Kitco senior technical analyst Jim Wyckoff.
Bitcoin futures 1-day chart. Source: Kitco
“A price uptrend is still in place on the daily bar chart but the bulls need to show more power soon to keep it alive,” Wyckoff said. “The recent higher volatility at higher price levels is not bullish. The BTC bulls do still have the slight overall near-term technical advantage.”
MN Trading analyst Gunter Lackmann sees the 8-day exponential moving average (EMA) as providing support at these levels, but warned that there is a strong likelihood of a pullback that retests the previous range high before BTC makes its next leg up.
BTC/USD 1-day chart. Source: MN Trading
“BTC Price has been consolidating mostly above the 0.382 fib retracement level and mostly holds above the 8EMA coupled with an ascending triangle type of chart structure,” Lackmann said. “RSI is still above 60, which in continued uptrends points to additional strength.”
“Unless both the 8EMA and the 0.382 fib level support are lost, longs could be favored, with the $35,800 - 36,850 zone as an area of interest,” he said. “If (once) the 8EMA and 0.382 fibs level support is lost (several daily candle closes + struggle to get back above those levels) I will start looking for shorts in the market, but for now my targeted area is still $40 - 42k before a potential retest of the previous range high of around $30 - 31.5k.”
Market analyst Crypto Tony also sees a pullback in the cards for Bitcoin, and said the market is now entering an “accumulation phase” where dips are for buying.
$BTC / $USD - Update— Crypto Tony (@CryptoTony__) November 20, 2023
Once we top out around $39,000 - $40,000 i will then be expecting us to come down for the next phase. This phase 2 is the accumulation phase, where we pick up some juicy buys. Do not be scared of this phase and the dips to come pic.twitter.com/2bWd3Pweyf
And in response to repeated inquiries as to whether or not Bitcoin will “dump to $30,000” before an ETF is approved, crypto analyst Pentoshi said, “Nobody can know that. Understand this. It’s all probability-based. I think your best shot is 32-33k at most IF one comes.”
Altcoin rotation continues
It was a mixed day of trading for altcoins, with a slight majority of tokens in the top 200 recording losses.
Daily cryptocurrency market performance. Source: Coin360
Skale (SKL) led the gainers with an increase of 43.5%, followed by a 17.5% gain for Axelar (AXL) and a 10.7% increase for Illuvium (ILV). Kaspa (KAS) was the biggest loser, falling 12.1% to trade at $0.132, while Worldcoin (WLD) declined by 11.8%, and Celestia (TIA) lost 9.8%.
The overall cryptocurrency market cap now stands at $1.42 trillion, and Bitcoin’s dominance rate is 51.6%.