The Bitcoin and crypto market has been volatile for most of 2022. Judging by the ongoing bear market, most experts were optimistic that it was close to an exit point. However, recent trends in the crypto world and macrofinancial activity have extended the downward trend.
The rate hike by the FBI continues to negatively impact crypto assets. XRP’s case with the SEC has also hurt crypto holdings. With their recent victory over crypto giants LBRY, the XRP case is viewed with fear.
XRP and LBRY cases bear striking similarities, though XRP’s legal team has expressed confidence in their chances.
More recently, the collapse of FTX has also sent investors into a withdrawal rage, preferring to hold on to their assets. In addition, confidence in central exchanges has now fallen to an all-time low, casting doubt on the legitimacy of cryptocurrencies.
In the last 24 hours, the prices of cryptocurrencies have changed significantly, with changes registered in most projects.
Bitcoin price drama
BTC price recorded a brief bullish rally attributed to the tweets from Elon Musk and Binance CEO Changpeng Zhao. Zhao talked about creating an industry recovery fund to help crypto projects that are strong but facing liquidity issues.
This announcement comes on the heels of the FTX disaster and Binance’s proposed bailout that was put on hold.
Elon Musk had responded to a tweet from Michael Saylor about converting his Tesla holdings to Bitcoin and its positive effect on the market. The Twitter exchange between the two entrepreneurs sparked a brief rally for the world’s number one cryptocurrency.
Bitcoin price hit an intraday high of $17,190. However, it failed to resist the resistance and succumbed to bearish pressure which subsequently fell to USD 16,191. BTC price has recovered somewhat and is currently trading at USD 16,713.
The total market capitalization for crypto is around $890 billion. These figures show a $10 billion increase in market capitalization. However, Bitcoin’s dominance took a hit and currently stands at 36.6%.
With the current volatile market phase, investors are likely to proceed with caution as events unfold. However, Bitcoin is likely to lead the rally as prices recover in the coming days.
Price performance of Bitcoin
Bitcoin’s recent price performance shows that the coin is seeing a drop in price. The collapse of the FTX may also have contributed to this downward spiral. Investors have gone short on losing positions to limit losses and avoid total bankruptcy.
Bitcoin’s current support levels are $16,265 and $16,404.8. However, market volatility will affect Bitcoin’s price, with the coin crossing the critical pivot point of 16541.7.
The MacD indicator clearly shows Bitcoin’s brief rally and descent into a full-blown bearish phase. Volatility is high and a risky investment for investors as a further decline is still likely.
The SMA 50 and 200 also reflect BTC’s bearish trend and are likely to fall further on the chart. Bitcoin is not likely to turn bullish.
Featured image from Pixabay, chart from TradingView.com
