Bitcoin is starting to move out of its recent price range due to rising inflation in the US. It’s quite probable that its value could decrease to around $25,000.
Bitcoin is currently facing challenges as its value has fallen below $29,000. The trading volume reached $16 billion on Thursday, mainly because the overall cryptocurrency market is experiencing a downward trend.
With a 2.3% decrease, Bitcoin’s price is now $28,230 on Thursday. It might even go lower than $25,000 before it has a significant recovery.
Bitcoin May Escape Sideways Trading:
Bitcoin and the cryptocurrency market have once again been affected by inflation concerns in the United States. This happened after the Federal Reserve shared the minutes of a meeting held in July to discuss their monetary policy plans for the coming months.
In these minutes, the Federal Open Markets Committee (FOMC) discussed how inflation could remain high if interest rates weren’t increased. The Federal Reserve had stopped raising rates in June but resumed with a small increase in July, which worried investors who hold riskier assets like Bitcoin.
The minutes mentioned, “With inflation still higher than what the Committee aims for in the long run and the job market staying strong, most participants believed there are significant chances that inflation could rise even more. This might lead to needing to make the monetary policy tighter.”
The release of these minutes led to challenges for Bitcoin and other cryptocurrencies, even though the Federal Reserve wasn’t entirely certain about how their prolonged tight monetary policy would impact the situation.
Examining a Possible 13% Decline:
The daily chart shows a pattern called a double-top, indicating a potential 13% decline in BTC’s price.
This pattern signals a bearish reversal, happening when an asset reaches a high price twice with a slight drop in between. In this case, BTC struggled to surpass the $32,000 level.
The pattern is confirmed if the price falls below the low point between the two highs. Traders expect further decline and might sell or short BTC.
Analysts at Rekt Capital suggest that BTC might need to drop around 9% to 13% more to complete this potential double top.
The Moving Average Convergence Divergence (MACD) indicator suggests sellers are strong, hinting at BTC’s potential to continue dropping toward the $25,000 support.
A sell signal from the MACD, with the blue line crossing below the red signal line, supports the bearish outlook.
If the 100-day Exponential Moving Average (EMA) at $27,931 provides support, BTC might react positively, avoiding a drop to $25,000 and aiming for resistance levels at $30,000 and $32,000.
Important:Â Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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