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(Kitco News) - Cryptocurrency prices consolidated in trading on Wednesday as a lull in major developments provided traders with time to reassess the state of their portfolios and rebalance their positions accordingly.
Stocks extended their win streak as better-than-expected earnings data continues to roll in, supporting optimism among investors that the economy is getting back on track after struggling for years in the face of the Covid pandemic and rising inflation. At the closing bell, the S&P, Dow, and Nasdaq were up 0.24%, 0.31%, and 0.03%, respectively.
Data from TradingView shows that Bitcoin (BTC) traded within a tight range between $29,855 and $30,264, with neither bulls nor bears gaining the upper hand as traders await the next market-moving development.
BTC/USD Chart by TradingView
Kitco senior technical analyst Jim Wyckoff noted that “August Bitcoin futures prices [were] slightly up in early U.S. trading Wednesday, after hitting a four-week low on Tuesday.”
Bitcoin futures 1-day chart. Source: Kitco
“Trading has turned sideways and choppy, with the bulls fading just a bit now,” Wyckoff said. “The bulls still have the slight overall near-term technical advantage but need to move prices above the recent choppy and sideways trading range to gain fresh power.”
According to MN Trading analyst Daan Foppen, “The monthly timeframe clearly shows that we are in a bullish market structure.”
BTC/USD 1-month chart. Source: MN Trading
“We can see that all Fair Value Gaps (FVGs) are being respected,” he said. “These FVGs are considered a draw on liquidity, as they represent internal range liquidity. Prices tend to gravitate towards these levels. We can clearly see that there is a monthly Fair Value Gap above us, and I also think that this will be the area where prices will move towards in the midterm.”
When it comes to the weekly time frame for BTC, Foppen noted that there were some developments he would like to see before entering any new trades.
“I would prefer to see a move downwards first before we continue the price uptrend,” he said. “The weekly timeframe shows the following: we have mostly seen sideways price action, and after the upward impulses, we have consistently left an imbalance on the weekly timeframe.”
BTC/USD 1-week chart. Source: MN Trading
“We can see that after a period of consolidation, we test this imbalance before making the next move,” he noted. “On the spot pair of BTC, we haven't had this backtest yet, and I would like to see it before further upward movement. I must also mention that different futures charts show that we have experienced a dip, but I am not entirely convinced that it has been enough.”
He added that Bitcoin's price could “drop quite significantly and still be in an uptrend.”
Altcoins stabilize and climb higher
The majority of tokens in the top 200 traded in the green on Wednesday while those that were in the red saw minimal losses.
Daily cryptocurrency market performance. Source: Coin360
Stellar (XLM) continues to benefit from the developments related to XRP as its price increased 25.4% to trade at $0.162, while Optimism (OP) gained 11.3% and Hedera (HBAR) climbed 9.93%.
The overall cryptocurrency market cap now stands at $1.21 trillion, and Bitcoin’s dominance rate is 48.3%.
