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(Kitco News) - The lack of an agreement on raising the U.S. debt ceiling continued to put a damper on any rallies in financial markets on Tuesday, with stocks trending down for the day while the cryptocurrency market remains in a sideways holding pattern.
At the close of markets in the U.S., the three major indices were all in the red, with the S&P down 1.02%, the Dow down 0.60%, and the Nasdaq down 1.22%. Treasury yields moved higher across the curve with the benchmark 10-year yield rising to 3.76%, the two-year climbing to 4.38%, and the 30-year bond rising to 3.98%.
Data provided by TradingView shows that Bitcoin (BTC) bulls managed to rally its price back above the $27,000 support/resistance level to hit a daily high of $27,511 in the early trading hours on Tuesday. BTC has since drifted down to support at $27,200.
BTC/USD Chart by TradingView
The early morning rally for BTC led to “firmer” June Bitcoin futures prices on Tuesday, according to Kitco senior technical analyst Jim Wyckoff.
Bitcoin futures 1-day chart. Source: Kitco
“The price downtrend on the daily chart has now stalled out and turned into sideways trading,” Wyckoff said. “Bulls and bears are now back on a level overall near-term technical playing field.”
According to market analyst Michaël van de Poppe, Bitcoin needs to hold above $27,000 in the short term to possibly set up a run to $29,000, with acceleration happening once the price closes above $27,300.
Good move of #Bitcoin, but still tapping resistance and not breaking through it.
— Michaël van de Poppe (@CryptoMichNL) May 23, 2023
Needs to hold $27K and then we can break through $27.3K and run to $29K.
The acceleration will come above $27.3K. pic.twitter.com/mHHi0LxiNp
Market analyst Rekt Captial noted that the daily RSI for Bitcoin is signaling a strong bullish divergence, which is a possible signal for some upside movement.
#BTC may be forming an "exaggerated" Bullish Divergence on the Daily RSI
— Rekt Capital (@rektcapital) May 23, 2023
A potentially positive sign for some upside movement however important to realise that the key resistance to beat is ~$27600$BTC #Crypto #Bitcoin pic.twitter.com/OL5IRY4XPX
This outlook was further supported by market analyst Caleb Franzen, who posted the following tweet suggesting that the current “RSI divergence will produce a bullish thrust on a short-term basis.”
I still think that the #Bitcoin RSI divergence will produce a bullish thrust on a short-term basis.
— Caleb Franzen (@CalebFranzen) May 23, 2023
While price made lower lows, RSI made higher lows.
Now we're seeing $BTC & the RSI making higher lows together!
I want to see price > $27,972 in order to confirm.
Also, gm. pic.twitter.com/lvfGPdBRZ0
Taken together, the consensus is that a major uptrend for Bitcoin is possible once bulls are able to push its price above $28,000.
Uptrend in the altcoin market
The majority of tokens in the top 200 traded in the green on Tuesday with a handful of projects managing to post double-digit gains, led by Waves (WAVES), which climbed 14.9% to trade at $1.90.
Daily cryptocurrency market performance. Source: Coin360
Other notable gainers include TomoChain (TOMO), Blur (BLUR), Render Token (RNDR) and Kava (KAVA), which saw their prices increase 13.7%, 12.56%, 11.28% and 11.08%, respectively.
The overall cryptocurrency market cap now stands at $1.137 trillion, and Bitcoin’s dominance rate is 46.4%.
