Extreme fear is once again the dominant sentiment in the cryptocurrency community after Bitcoin (BTC) enjoyed another trading day below $40,000 and the United States struggled with the highest Consumer Price Index (CPI) since 1981.
Crypto Fear and Greed Index. Source: Alternative.me
Data from Cointelegraph Markets Pro and TradingView shows that an early morning attempt to rally above $40,000 met a resistance wall at $40,650 and BTC price eventually fell back below $39,600.
BTC/USDT 1-day chart. Source: TradingView
Here’s a look at what several analysts are saying about the current state of bitcoin and what could possibly be next as financial markets grapple with rising uncertainty.
Bitcoin is simply retesting a large S/R zone
The current price action for Bitcoin is widely viewed as a retest of a major support and resistance (S/R) zone, according to crypto analyst and pseudonymous Twitter user Credible Crypto sent The chart below shows the multiple retests of this level going back to 2020.
BTC/USD 1 week chart. Source: Twitter
According to Credible Crypto, both the middle green circle and the final red circle provide past examples of intra-week moves that went above or below the weekly level, “but it means nothing without confirming a close.”
Credible Crypto said:
“Give me a closing score below BLUE and I’ll change my mind, but right now there’s no need to.”
Some analysts are forecasting a lackluster recovery
Insights into the on-chain behavior of Bitcoin investors were discussed in Glassnode’s recent weekly report, which noted that there had been “a modest volume of investor profit-taking” after BTC broke out of a multi-month consolidation offering.
According to Glassnode, “the market has posted around 13,300 BTC in gains per day since mid-February,” and while that figure is not “historically extreme,” it does seem to “provide enough headwind for prices.”
Bitcoin made profit. Source: Glassnode
Overall, the recent recovery for Bitcoin has been relatively muted as the market awaits a major catalyst to help bring fresh impetus and new inflows to the cryptocurrency market.
glassnode said,
“Specifically in terms of on-chain activity metrics such as transaction counts and active users, the recovery so far has been relatively lackluster and continues to suggest that Bitcoin is a HODLer-dominated market with few new investors pouring in.”
Related: Ethereum price’s “bullish triangle” puts 4-year highs against Bitcoin within reach
A “MEGA PUMP” is coming
A strong bullish narrative has been highlighted by crypto trader “BTCfuel”, who sent The chart below outlines the possibility of an impending Bitcoin “mega-pump.”
BTC/USDT 1-day chart. Source: Twitter
BTCfuel said,
“If you look at the RSI, the 2022 bitcoin correction is very similar to the 2021 correction. A strong BULLISH move is imminent.”
The total cryptocurrency market cap is now $1.850 trillion and Bitcoin’s dominance rate is 40.9%.
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