$38,000 could be the next stop on a downward trend, but $32,000 appears to be the final floor.
Overnight, Bitcoin (BTC) experienced its first serious challenge of $40,000 in some weeks, but what price zones are traders looking at next?
For many, the answer is simple: the range is still intact, whether in the long or short term.
After the “moment of truth,” Bitcoin is shaky.
According to statistics from TradingView, BTC/USD suffered a moderate sell-off on Feb. 17, which continued into Friday, with local lows of $40,330 emerging on Bitstamp.
Although the pair has risen beyond $41,000, traders are wary of further tests of the bulls’ commitment.
A common bounce zone in the case of a break below is now $38,000, and when last night’s lows set in, popular Twitter account Credible Crypto emphasised the importance of holding that amount moving forward.
They summarised it as a “moment of truth” with a forecast graphic.
“If our bottom is in at 32k, then the downside should be limited to the GREEN zone below in order to establish a higher low.” This is my primary, and I expect us to keep this zone and push through monthly barriers once more.”
Some were less enthused about the potential, with Crypto Ed, a well-known trader, expressing reservations about even the $40,000 test.
“Hanging on the 40k cliff, it feels like a miracle is required following yesterday’s (for me) unexpected move down,” he remarked.
Meanwhile, the derivatives market structure confirms that the macro bottom is around $32,000. Bidders entered at that point when it hit in January, according to analyst Dylan LeClair, giving more than just a line in the sand for price stability.
In one of a series of tweets regarding the environment, he stated, “The speculative air in the $BTC derivative market has virtually totally unwound, with spot market bids taking hold at 33k in early January.”
Honestly fam, if I had to judge by the weekly chart I would say pack your stuff it's over but…
yeah… let's see pic.twitter.com/95Z9cObaS3
— muro – won't DM you (@MuroCrypto) February 17, 2022
While some people were nervous about looking at longer timescales, LeClair claimed that nothing had truly changed and that Bitcoin was still on schedule with its four-year halving cycles.
“Regardless of the macro situation, the bitcoin monetization process continues. With all of the uncertainty, bitcoin is trading at almost an order of magnitude higher than it was at the start of the previous cycle. He said, “Don’t lose sight of the big picture.”
The overnight lows, as expected, filled a CME Bitcoin futures gap left over from the start of the month’s withdrawal out of the $30,000–$40,000 corridor.
Price issue is “largely noise,” according to a fidelity expert.
Jurrien Timmer, director of global macro at asset management Fidelity, urged for a shift in focus away from price analysis and toward multi-year network expansion after looking at the year’s highs and lows.
“Bitcoin has been swinging between 30k and 65k for about a year now, in a choppy trading range. Many people enjoy debating whether something is better or worse, but it’s just noise. “What matters in Bitcoin is the network,” he told Twitter followers last week.
Bitcoin’s price ambitions, according to Timmer, are similar to Apple’s transformation from the 1990s to today.
The outcome could be a considerably slower path to $1 million and beyond than many anticipate, but network foundations and adoption should always come first.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.