Bitcoin entered the week with price action rising to the average levels of its current levels. However, the bulls face hurdles as an increase in selling pressure has pushed the price of BTC down from $ 66,000 to a current price of $ 64,262 at the time of writing.
Bitcoin entered a zone of consolidation after a lightning crash pushed its price from the highest of current levels to critical support at around $ 62,500. Bullish sentiment appears to be fading as uncertainty grips the market.
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Many traders expected more decisive price action from the benchmark cryptocurrency and a clearer path to a short-term price target above $ 70,000 and ultimately $ 100,000. Macroeconomic variables appear to be working against the rally in BTC prices.
US Fed Chairman Jerome Powell has hinted at the start of a cut that could take liquidity out of global markets. Additionally, the crisis with Chinese real estate giant Evergrande continues to wreak havoc on the financial sector, with many investors fleeing to the US dollar.
As seen below, the US Dollar Index (DXY) has been trending upward since November 10e. Around the same time, Bitcoin plunged into the bottom $ 60,000, dragging the entire crypto market with it.
In the short term, there appears to be an inverse correlation between Bitcoin and the DXY. If the US currency strengthens, the price of BTC could revisit the critical support area around $ 62,000.
In this scenario, the bulls might face other obstacles. Data from the hardware indicators indicate that Bitcoin lost some support below $ 64,000.
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As the Fire Chart below shows, there was $ 21 million in bidding (in red below the Bitcoin price display in blue) for BTC before it was rejected at $ 66,000. Right now there are less than $ 15 million on offer with an additional $ 28 million but much less at $ 61,500.
This suggests that Bitcoin could continue to move lower in the near term. Below $ 60,000, a massive auction wall has been removed to $ 54,000, but this could imply a bullish pursuit for Bitcoin or at least more support around $ 60,000, significant support for this area which needs be maintained in order to resume the rally.
As material indicators claims:
(…) A huge BTC auction scale of up to $ 54,000 was drawn. It is not a rugpull. They could not be filled this low because the buying area increased.
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On longer time frames, the Bitcoin Taproot upgrade failed to become a bullish catalyst as traders were already pricing the event. In the long run, improvements to the BTC network will certainly be a positive wind for the price of the underlying asset.
BitBank analyst Yuya Hasegawa said the price of BTC fell due to the US SEC’s rejection of its tied spot ETF filed by investment firm VanEck.
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The price has seen a relatively rapid recovery due to the bullish trend in the stock market, but the analyst expects the price to remain between $ 58,000 and $ 69,000 with potential for a new all-time high at around $ 76,000.