Bitcoin (BTC) price failed to overcome $ 50,000 psychological resistance over the weekend and fell below the $ 48,000 level on March 6.
Traders are now looking to see if BTC / USD can break above the $ 50,000 level to resume the bullish cycle. On the contrary, a drop below recent lows below $ 46,000 is likely to open new lows, which may then threaten an upward rally that has lasted for about a year, at least in the short to medium term.
A trader under the pseudonym Rekt Capital has indicated a similar price level that is worth noting. If BTC does not maintain current levels above $ 46,000, the trader expects Bitcoin to drop somewhere in the $ 38,000 to $ 45,000 range, even though Bitcoin has hit its lows in recent days.
He wrote, “BTC maintains less pressure until that happens.” “Every subsequent reaction from January HL has been less and less. It might be the same now. Better safe than sorry, prepare for the potential breakdown of this HL.”
An important factor that can cause current price pressure is the increase in whale activity. CryptoQuant data shows an increase in large transactions on exchanges on March 6, although mining activity remains relatively low.
As shown in the chart below, ex whales in whales that were transporting money to the exchange coincided with the decline in the bitcoin price on March 3.
Macroeconomic Winds of Bitcoin
Bitcoin is also facing pressure from conflicting macroeconomic factors as reported by Cointelegraph. The high US government interest rates for 10 years and the decline in stocks, especially technology ones, negatively affect cryptocurrency prices as investors flee risky assets.
Meanwhile, the US dollar index, or DXY, broke the technical resistance and reached its highest level since November 2020.
Michael Van de Pope, an analyst at Cointelegraph Markets, notes that Bitcoin’s downtrend remains unchanged after the last attempt to breach $ 50,000 failed.
“This means that the trend is still down and there is general weakness in the markets in the short term,” he explained. “$ 50,000 is currently not acceptable for Bitcoin.”
However, Bitcoin, like gold, may soon get some breathing room as DXY and Treasury returns close to their technical resistance levels.
“I think the yield, including the DXY, will peak relatively soon,” Van de Pope explained. “Both are in resistance areas, which means that we should be close to the upper two configuration, but also the lower bitcoin and gold formation relatively soon.”
March is often a bad month for markets and history repeats itself. Thus, at the macroeconomic level, we remain optimistic about the cycle and are preparing for its continuation despite the recent interest in interest rates. “