A Christmas party for stocks masks “a massive amount of weakness,” one commentator warns, as Bitcoin sentiment votes with its feet.
Bitcoin (BTC) dropped nearly $4,000 on Dec. 28 as the market offered a sharp reminder that the bull run would need to wait.
BTC analysts eyes $44,000
BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD hitting lows of $48,335 on Bitstamp at Dec. 28’s Wall Street open.
The pair had passed $52,000 the previous day, this marking a three-week high, before pressure from sellers halted progress.
At the time of writing, Bitcoin circled $49,000 as traders took the opportunity to remind audiences of Bitcoin’s ongoing active range.
“Humans get bullish at resistance. It’s a thing,” Scott Melker summarized.
The $52,000 trip indeed failed to attack any of the price levels previously identified as turning points, notably $53,000 — Bitcoin’s $1 trillion market cap mark.
Popular trader Pentoshi meanwhile identified $44,000 as a potential floor should the downward trend accelerate. Slightly longer timeframes offered a similar outlook based on recent behavior.
Fulcrum around which price has been pivoting.
Bounce or back to the bottom of the channel? pic.twitter.com/BTJR5rN87I
Zooming out, however, and there were bearish considerations on the horizon. William Clemente, the lead insights analyst at Blockware, identified a potential repeat of behavior immediately after 2017’s old all-time high, which led to an entire year of a bear market.
“Judgment day is coming for BTC,” he warned in Twitter comments.
Concerns loom over miracle equities readouts
Bitcoin thus presented a contrast to macro Dec. 28 as the S&P 500 hit its 69th all-time high of the year.
Related: Veteran Bitcoin hodlers are still selling record low amounts of BTC despite 70% gains in 2021
Almost a record in itself, stock market exuberance was already ruffling feathers among pundits concerned about a potential chasm between the numbers and empirical reality.
Just to put things into perspective: The S&P 500 may close today at another ATH, it would be the 69th ATH this year, 2nd most ever only behind 77 ATHs in 1995, but the average S&P 500 comp is down 18% from its ATH, suggesting a massive amount of weakness underneath the surface. pic.twitter.com/3RsPFP1Ajs
As Cointelegraph reported, the United States Federal Reserve will have a decisive role to play in shaping 2022’s market climate when it comes to Bitcoin’s performance.
In the meantime, however, BTC/USD faces a low-liquidity — and thus potentially high-volatility — holiday season.