Bitcoin loses ground as bulls continue to show post-rally exhaustion
Bitcoin has been showing signs of exhaustion ever since it broke through $21,500, but now weakness is starting to settle in and can be seen in the price action. Despite being held up by support at $22,300 we can see major distribution happening in the current range. The possibility of another high still exists, however, GDP tomorrow and Core PCE the day after will give us more information to anticipate future moves.
Meanwhile, the S&P 500 was unable to move above 4,050 and could try again today. Despite the S&P 500 showing strength yesterday, DXY clung to support around 102 and it continues to do so.
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Bitcoin Technical Analysis
Bitcoin's current range has established a bottom with a double retest at $22,300. However, unless we get a bounce soon, a final high toward $25,000 will be out of the picture since multiple retests usually end up breaking support.
Bearish divergences still exist and are increasing. Bitcoin is continuously being distributed at these prices as seen on CVD taken from spot exchanges. Furthermore, we have bigger buy walls at lower prices compared to sell walls, so a lot of liquidity is locked toward the downside.
Ethereum Technical Analysis
Ethereum had a small crash but with strong volume. It found support at $1,518 and bounced up to $1,554 with almost 1/3rd of the volume in comparison, making it a weak recovery unlikely to hold up in the coming days. Whether we make a final high or not will depend on Bitcoin and news coming in the next few days. Our first major buy wall is at $1,450 making it our POI in the near term.
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While this behaviour is not surprising, it is a reminder of the uncertain state of this market.
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Disclaimer: None of the information here constitutes financial advice and market participants are advised to conduct their own research since cryptocurrencies are speculative assets with considerable risks.