Bitcoin May Reach $40,000 Before BTC Price Sees ‘Hard Correction’ — Analyst

Bitcoin (BTC) faced selling pressure at the opening of Wall Street on February 21 as the United States stock markets opened.

BTC/USD 1 hour candlestick chart (Bitstamp). Source: TradingView

BTC price falls with US stocks

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD falling to daily lows of $24,324 on Bitstamp.

Bearish signals were already in place for the pair after it saw a swift rejection in its latest attempt to return $25,000 in support.

Amid suspicions of whale moves in the stock markets, tracking resource Material Indicators concluded that the 200-week moving average (MA) at $25,100 needed to become support for Bitcoin to reverse its long-term trend.

“IMO, until we see full candles above the 200 WMA, this is still distribution in a bear market rally, and with the supply wall above $24,000, shorting from this level has about as much short-term risk as longing.” , he wrote in part. comments on his latest Twitter update.

An accompanying chart of Binance’s order book showed liquidity moving closer to the spot price before the Wall Street open.

BTC/USD order book data (Binance). Source: Material Indicators/Twitter

Caleb Franzen, senior market analyst at Cubic Analytics, meanwhile had a bearish forecast for the S&P 500 in particular, with risk asset returns still weighing on crypto.

“The S&P 500 is lower, trading firmly below my $4,080 line,” he said. are summarized along with a chart of the day.

“A retest of the 200-day moving average is likely, which will be a vital support level.”

S&P 500 Annotated Chart. Source: Caleb Franzen/ Twitter

The S&P 500 was down 1.3% at press time, while the Nasdaq Composite Index was 1.7% lower.

The US dollar index (DXY), despite being broadly inversely correlated with stocks and cryptocurrencies, also took a hit at the open, falling to 103.77 before recovering.

US Dollar Index (DXY) 1 Hour Candlestick Chart. Source: TradingView

“USD higher highs and lows held for most of Feb 103.82 as support in DXY, current high-low,” part of commentary by trader and strategist James Stanley reading.

Stanley additionally noted minutes from the Federal Reserve’s Federal Open Market Committee (FOMC) as a potential market catalyst. Due February 22, the minutes reflect the February FOMC meeting, which saw the Fed raise its key interest rate by 25 basis points.

BTC Price Corrections “Relatively Shallow”

Taking an optimistic short-term view, meanwhile, Cointelegraph contributor Michaël van de Poppe, CEO and founder of trading firm Eight, was confident that the current decline would be temporary.

Related: Bitcoin Active Addresses ‘Concern’ Analysts Despite 50% BTC Price Gains

“Correcting markets, which is great for people looking for entry points. It may go down a bit more from here before we come back. Week of consolidation before resuming,” he said he said Twitter followers.

“FOMC minutes tomorrow as well. Remember, as far as investments go, it’s still extremely cheap for Bitcoin.”

Van de Poppe’s chart analysis showed that BTC price action is acting within a narrower wedge structure, with a key support area below $22,500.

Earlier in the day, his longer-term forecast called for higher highs before a more substantial correction, which is nonetheless apt to bring Bitcoin back to $20,000.

“Corrections remain relatively shallow. I think we will continue the path towards $35-40,000 before we have a hard correction, maybe even at $20-25,000. Maximize profits, start allocating to $USDT as high as we go, buy with correction in the second half of 2023,” he said He wrote.

The views, thoughts and opinions expressed herein are solely those of the authors and do not necessarily reflect or represent the views and opinions of Cointelegraph.