Extreme fear is once again the dominant sentiment in the cryptocurrency community after Bitcoin (BTC) faced another trading day below the $40,000 level and the US grapples with the printing of the highest consumer price index (CPI) since 1981.
Data of Markets Cointelegraph Pro Y TradingView shows that a morning attempt to rally above $40,000 hit a wall of resistance at $40,650 and BTC price eventually fell back below $39,600.
Here is a look at what various analysts are saying about the current state of Bitcoin and what could happen next as financial markets face ever-increasing uncertainty.
Bitcoin is simply retesting a major S/R zone
Bitcoin's current price action is largely seen as a retest of a major support and resistance (S/R) zone according to crypto analyst and pseudonymous Twitter user 'Credible Crypto', who aware the following chart outlining the multiple reassessments of this level since 2020.
According to Credible Crypto, both the middle green circle and the last red circle provide earlier examples of moves within the week that exceeded or declined the weekly level, "but it means nothing without a close to confirm."
Credible Crypto said,
"Give me a close below BLUE and I'll change my tune, but for now there's no reason to."
Some analysts project a mediocre recovery
Insights into the on-chain behavior of Bitcoin investors was discussed in Glassnode's most recent weekly report, which noted that there has been "modest volume of profit-taking by investors" following BTC's breakout from a consolidation of several months. distance.
According to Glassnode, “the market has seen around 13,300 BTC in gains made each day since mid-February” and while this value is not “historically extreme”, it appears to “be providing enough price headwinds.”
Overall, Bitcoin's recent rally has been relatively subdued with the market waiting for some major catalyst to help build new momentum and new cryptocurrency market entries.
glassnode said,
“Especially in on-chain activity metrics such as transaction count and active users, the recovery so far has been relatively lackluster and continues to suggest that Bitcoin is a HODLer-dominated market, with few new investors.”
Related: Ethereum Price 'Bullish Triangle' Puts 4-Year Highs Within Reach Against Bitcoin
A "MEGA BOMB" is coming
A strongly bullish narrative was highlighted by crypto trader 'BTCfuel', who aware the chart below outlining the possibility of an impending Bitcoin "mega bomb".
BTCfuel said,
“Looking at RSI, 2022 Bitcoin correction is very similar to 2021. Strong UP move imminent.”
The total cryptocurrency market capitalization is now $1.85 trillion and the dominance rate of Bitcoin is 40.9%.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should do your own research when making a decision.
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