While the summer may come to an end, Bitcoin struggles versus the dollar. The Merge is just a few weeks away, and Bitcoin is poised to ruin the fun for Ethereum fans. In addition, September is the most gloomy month for Bitcoin, which might make the start of the school year challenging. The US market is also declining. Has the market’s decline come to an end? Can consumers take back control? The 30th issue of Point Macro Hebdo is now available!
BTC DECLINES BELOW $20,000
For the king of cryptocurrencies, the previous week was challenging. In fact, it dropped more than 20% as cryptocurrencies increased in value:
As long as Bitcoin’s price fluctuates below the bearish trendline, it will continue to be fragile (brown). Since Bitcoin’s momentum has altered, it will turn bearish once more every day and in three days. The institutional bias (EMA 9/EMA 18) never crossed bullish during this retracement phase, indicating that Bitcoin’s momentum was weak. The bullish trendline (black) and the support at $21,000 both failed to hold, and the next significant support can be found at $19,200. The $21,000–22,000 range should now offer resistance on a rebound. The price is currently extremely unstable, and a new low cannot be ruled out.
The RSI indicates that the momentum is continuing descending below the negative trendline. As we can see, a few days ago, at the level of the trendline, the RSI was once more rejected. To perhaps see some strength on the buyers’ side, we will need to wait for a clear break in this trendline.
THE DOLLAR IS STILL ASCENTING
Risky assets like Bitcoin and US stocks continue to fare poorly as a result of the dollar’s continued strength. Since all of the asset’s retracements up to this point had just been breaths, the safe haven asset needed to change its momentum.
The Dow theory predicts that the lows and highs of the dollar have been rising for more than a year. The resistance, however, continues to hold, and as long as it does, we can anticipate a trend reversal at the resistance’s contact. We might assume that the price has returned in search of liquidity and is now prepared to decline. Divergence in the momentum suggests that it might go in this direction. In order for this to occur, the price must not close above the wick from July 14, since this would signal a continuation of the bullish trend with a higher high than the one before.
Given that an asset in an uptrend has the potential to diverge and keep rising, the institutional bias is always bullish, making the scenario described above still very speculative. To determine that the rise is over, the price must shift momentum.
GOLD REMAINS IN DECLINE
Gold is not in the same dynamic as the dollar if it is the safe-haven asset of 2022. Although gold is perceived by market participants to be a safe haven asset, it is now underperforming due to a very strong currency. Following a negative trend that started at the beginning of July, gold may reach a double bottom soon.
The trend for gold is currently unfavorable. If the price closes above $1,808, this might change. Buyers will have to maintain the range’s low point at $1,690 to do this. The institutional bias and negative trendline have recently caused gold to stop moving. By getting beyond these obstacles, buyers will have to demonstrate their presence.
Buyers face no resistance as the RSI rises above the bearish trendline. The RSI must also rise over 47 in order to create bottoms and ascending peaks.
The lower range will need to be defended by the buyers. The medium-long term trend would be affected if the price were to settle below the range.
THE US MARKET FALLS, BEAR MARKET RETURNS?
The S&P 500 declines and violates a crucial support level. At the negative trendline level, the price was rejected.
The price is still moving upward throughout this period of time, with increasing bottoms and rising tops. Naturally, the medium-term trend is still downward. Since the $4,160 support level has failed to hold, it’s possible that the price will drop to the next significant support level at $3,900. The scenarios shown on the graph correspond to the past week, and it appears that we are moving in the direction of the scenario highlighted in red.
Although the price has currently formed a “V top,” it is still feasible that it will rise again and ensnare the sellers. Additionally, the three-day bearish trendline is being crossed by bullish momentum, which is heading above it. In order to do this, we must immediately regain the $4,160 level.
NASDAQ NEEDS TO REBOUND
The NASDAQ is currently moving upwards. The local top is constructed with a “V top” and the troughs and peaks are rising. It’s important for the purchasers to move fast because the support is in the process of letting go. This could provide as support since institutional prejudice works as a dynamic support. The next support is located at $12,000 if it fails. The medium-term trend is still unstable at the present, and the price is still descending below the negative trendline.
The RSI must respond because it is currently on the bearish trendline. Going back below the negative trend could be risky because it might be a hint of a bullish trap. The time has come for purchasers to demonstrate that they are once again in charge of this market.
Risky assets will continue to be fragile as long as the dollar is strong. The price of the dollar index may alter in the upcoming weeks, but this is obviously not the case right now. The king of cryptocurrencies, Bitcoin, is underperforming the US market and is struggling to perform versus the dollar. We observe that capital is not now going to the riskiest assets. Although the US market displays signs of fever, the trend has not changed after three days. Now, buyers must demonstrate that this is not a downtrend correction. The beginning of the school year will probably be chaotic.