The $25,000 level for Bitcoin is emerging as an important technical hurdle to the token’s partial recovery from last year’s crypto rout.
Bitcoin rallied that level on February 16 for the first time since August but has struggled to stay above it. The largest digital coin gained 2% on Monday to hover around the $25,000 mark.
The token’s strong New Year’s performance appears to be driven in part by the idea that the worst of the monetary tightening is over. Some investors also support the view that the Federal Reserve can quell inflation without causing WE economic downturn, has driven risk assets from stocks to crypto.
“With the market swapping the ‘hard landing’ narrative of last year’s Q4 for a ‘no landing’ narrative in the first quarter of 2023, financial markets have become increasingly bullish on the market,” said Tony Sycamore, market analyst at IG. speculative assets have been well supported, including Bitcoin.” Australia Pty, wrote in a note.
At the same time, skeptics argue that the US economic resilience will only lead to higher borrowing costs in the longer term, which will dampen the upbeat mood. The crypto sector also faces a US crackdown following the collapse of the FTX exchange.
The struggle between bulls and bears is currently being contested around $25,000 for Bitcoin.
Matt Maley, chief market strategist at Miller Tabak + Co., wrote in a note: “Whether it can cross $25,000 soon is critical. “The next week or two will be crucial for Bitcoin and other cryptocurrencies.”
Here are three charts that break down that topic:
Candlestick pattern
Bitcoin has been following a series of so-called doji candles in recent days. These are trading sessions in which the token posts about the same opening and closing prices despite intraday fluctuations. Some chart analysts see this as indicative of investors’ indecision about the outlook, while others may interpret dojis as potentially signaling a retracement.
abnormal ground
Bitcoin is about to pass the second bullish standard deviation of the average price since the lows it reached after the crash of FTX in November. That would put a recovery into relatively rare territory. Bears will say that is reason to be cautious. The bulls may embrace it as a sign of an unusual rally still underway.
Betting Options
Options data from Deribit shows a large number of unsettled Bitcoin call options — the so-called open interest — at $26,000 and $30,000 respectively. If Bitcoin manages to scale the $25,000 mark, those bets suggest the next big test lies at those levels.
