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(Kitco News) – Financial markets traded in the red on Thursday as uncertainty about future interest rate hikes left investors unsure about their level of risk moving forward, prompting many to adopt a wait-and-see approach before they decide to increase their exposure.
Stocks saw gains in early trading, but the trend turned negative in the afternoon and brought an end to the 13-session win streak for the Dow. At the market close, the S&P, Dow and Nasdaq were all in the red, down 0.64%, 0.67%, and 0.55%, respectively.
Data provided by TradingView shows that Bitcoin (BTC) bulls attempted to push towards the $30,000 support/resistance level, but were stopped short at $29,700 by bears, who smacked Bitcoin’s price back down to support at $29,200.
BTC/USD Chart by TradingView
“August Bitcoin futures prices [were] firmer in early U.S. trading Thursday,” according to Kitco senior technical analyst Jim Wyckoff, who noted that “Prices have rebounded modestly late this week but are still in a fledgling downtrend on the daily bar chart, albeit at higher price levels.”
Bitcoin futures 1-day chart. Source: Kitco
“Bulls and bears are on a level overall near-term technical playing field at present,” Wyckoff said.
According to Markus Thielen, head of research at Matrixport, Bitcoin failed to reach his summer target of $35,000, “and there is now the risk that Bitcoin will re-test its 200-day moving average. Frequently Bitcoin re-tests its 200-day moving average in bear markets (March 2022) as well as in bull markets (March 2023).”
The 200-day moving average is currently around $26,500, which means Bitcoin could decline by another 8% from its current level to retest the 200MA.
BTC/USD Chart by TradingView
“This level might coincide with the seasonal decline in September, the weakest and only negative month based on ten years of historical analysis,” Thielen said. “Bitcoin has declined, on average, by -4% in September, with the last six September experiencing negative returns.”
MN Trading founder Michaël van de Poppe also sees the potential for further downside before BTC price resumes its uptrend, but predicted a more shallow pullback than Thielen, with BTC dropping to a low of $28,500.
Getting there.
Breaking $29,700 would be an ultimate trigger for new highs for #Bitcoin. pic.twitter.com/w2NYMMMCnh
— Michaël van de Poppe (@CryptoMichNL) July 27, 2023
And market analyst Rekt Capital noted that a monthly close above support at $29,250 “would confirm the retest of that support level as successful,” and “would position BTC for trend continuation into at least the mid-$30,000s.”
BTC/USD 1-month chart. Source: X
Negative day for altcoins
It was a down day for the altcoin market as roughly three-quarters of the tokens in the top 200 traded in the red, while most of the gainers saw increases of less than 2%.
Daily cryptocurrency market performance. Source: Coin360
Stellar (XLM) and XDC Network (XDC) recorded the largest increases, up 8.64% and 7.87%, respectively, while Worldcoin (WLD) fell 10.4% and Kyber Network Crystal v2 declined by 9%.
The overall cryptocurrency market cap now stands at $1.18 trillion, and Bitcoin’s dominance rate is 48.2%.
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.
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