Bitcoin traders pinpoint key levels to watch as BTC price tests key trendlines
The 200-week moving average is just one of a series of lines in the sand for Bitcoiners to keep their eye on this week.
Bitcoin (BTC) is pressuring newly-won support levels this week as geopolitical uncertainty raises the stakes for risk assets.
After an impressive monthly close, momentum appears to be waning for Bitcoin’s latest gains, data from Cointelegraph Markets Pro and TradingView shows, and stock markets are not helping the bulls.
Volatility was cool as August began, but angst over a potential showdown between the United States and China over House Speaker Nancy Pelosi’s visit to Taiwan is already showing in Asian trading on Aug. 2.
Amid talk of a “bear market rally” being all that can describe the current setup, Cointelegraph takes a look at the crucial support and resistance levels currently facing the market on short timeframes.
Traders unconvinced over fate of 200-week moving average
Analyzing order book data on Binance, the largest exchange globally by volume, pockets of buy and sell interest stand out immediately.
At present, BTC/USD is eating through a band of bids just below $23,000. Should all that liquidity be taken, however, there is little more to support price action until closer to $21,000.
The strength of buy and sell “walls” on the Binance order book can be deceptive, as large-volume players can quickly move bids or asks from one level to the next.
The latest data was uploaded to social media by on-chain analytics resource Material Indicators on Aug. 1. It additionally highlighted the importance of Bitcoin’s 200-week moving average (MA) at just above $22,800.
Certain whales, Material Indicators noted, were attempting to keep the 200-week MA as support but seeing little consensus from other trader groups, something which resulted in a subsequent dip below the trendline.
“Doesn’t look they are getting much help from other classes. Not sure how long they can keep this up,” part of accompanying comments read.
$26,000 then “new lows”?
Despite the Taiwan situation unnerving markets on the day, a short-term move higher for Bitcoin is not off the table, even for some of its most conservative analysts.
Related: Best monthly gains since October 2021 — 5 things to know in Bitcoin this week
For popular Twitter account Il Capo of Crypto, BTC/USD even had the potential to hit $25,000 before returning lower than current levels.
Responding, fellow trader Jibon suggested that it could be $26,000 before a bearish pivot enters.
— Trader_J (@Trader_Jibon) August 2, 2022
While they kept quiet on a potential downside target, Venturefounder, a contributor to on-chain analytics platform CryptoQuant, called $22,000 a “good price” to set up a BTC long.
Altcoins, including Ether(ETH), looked less appetizing.
“I still think most altcoins are too expensive for this part of the cycle, or should I say Bitcoin is too cheap?” he queried on Aug. 1.
“$22k is still good price to long BTC for me. Can’t say the same for altcoins, not even $ETH.”
ETH/USD traded below $1,600 at the time of writing, down around 4% on the day but still 12% higher than the same time a week ago.
“Unless you think ALTs are going to break to their ATH against BTC soon, makes no sense to long,” Venturefounder added.
A look at the ETH/BTC chart meanwhile shows the importance of 0.075 resistance for ETH bulls, this failing to crack during the July crypto rally.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.