Bitcoin (BTC) arrived at $43,500 yesterday morning after a surprising rise of nearly 15% from $38,000. Then the price initially dropped to $43,000, but bitcoin then jumped again from there.
Bitcoin price rise slows down
Yesterday afternoon the tapped bitcoin price on a number cryptocurrency-exchanges nearly $44,900 to. That was the highest price since bitcoin lost its grip on the USD 44,000 two weeks ago. Still, the resistance was still too strong and bitcoin subsequently fell back to USD 43,400.
Despite this, bitcoin was still in an upward trend, but it slowed down considerably. Bitcoin was then able to rise slightly, but already encountered too much resistance around USD 44,500 last night. The price then made small swings and was rejected again around the same price.
This morning, bitcoin briefly dipped to $43,800 and is at $43,900 at the time of writing Binance and €39,600 on Battle.
Trust returns as a safe haven
After weeks of increasing fear and uncertainty on the cryptocurrency market due to macroeconomic developments, confidence finally seems to be returning. That may mean that some of the fear was already priced in. The situation in Ukraine caused, as in March 2020, the status of bitcoin as a safe haven to be questioned. In recent days, it seems to be slowly regaining this status. However, it is possible that the situation in Ukraine will deteriorate further and then bitcoin may be included.
Volumes in Ukraine and Russia are increasing
Nevertheless, the increasing confidence that the demand for bitcoin is finally rising again and the volume is increasing. We are seeing significant peaks in volumes, especially in Ukraine and Russia. The story that the Russian oligarchs are behind this is unlikely. Demand seems to be mostly spot-driven, which is healthier for the market compared to the large numbers of buyers long positions that have been closed in recent months.
Activity on Binance suggests that both Ukrainians and Russians seek crypto as a safe haven for their savings as war ravages and capital controls intensify.
Read more here: https://t.co/IFHeB0bgxG pic.twitter.com/Yffu26UsLe
— Arcane Research (@ArcaneResearch) March 2, 2022
Not the whales that accumulate
There is also a story that whales are accumulating en masse again, but according to Rafael Schultze-Kraft of analysis company Glassnode that is not true. This time it is mainly smaller investors who are accumulating. However, whales are shifting and that can cause sales pressure.
The uptick in addresses holding more than 1,000 BTC is a result of the WBTC custodian moving reserves into a bunch of newly created addresses.
Not “whale accumulation”.#Bitcoin pic.twitter.com/dTil8wtIwU
— Rafael Schultze-Kraft (@n3ocortex) March 1, 2022
Possible disconnection
The market is also talking about a possible “decoupling” between bitcoin and the more traditional risky asset markets. Although the correlation is currently declining sharply and bitcoin is regaining its safe-haven status, it may be too early to talk about an actual decoupling.
Yesterday, all eyes were on the opening of the Moscow Exchange, or MOEX, which was delayed by several hours. In the end, however, the MOEX remained completely closed and the doors remain closed today.
Bitcoin in orange, Nasdaq in blue pic.twitter.com/pbqz1UYEXe
— Will Clemente (@WClementeIII) March 1, 2022
Possibly a lot of resistance
Despite increasing confidence in bitcoin, further escalation in Ukraine could still cause a lot of panic and selling pressure. Investors are also still concerned about the Federal Reserve’s upcoming policy.
With bitcoin still struggling to break through $45,000, several analysts are starting to talk about a possible correction before the price rises again. Between USD 44,000 and USD 46,000, there is considerable resistance, which could mean that we will see a retest of the area between USD 40,000 and USD 43,000 before the price breaks through. Meanwhile, analysts are also talking about a possible double bottom, a bullish sign.
Sellers enter at $44.4k 🔴🔴
To break successfully one must Absorb Liquidity, now one level higher. ⬆️In a bullish structure when liquidity is absorbed, price gains a level and reestablishes the old Resistance region as Support.
In the current case $40.8k is that Support! pic.twitter.com/g5xHRfil2q
— G a a h (@gaah_im) March 1, 2022
Looks like a potential double-bottom is in the making for BTC and the related equities. pic.twitter.com/gzbVqdG7Pg
— Jurrien Timmer (@TimmerFidelity) March 1, 2022
–
