According to crypto analyst Cryptonary, the backdrop of the market's current scenario has been painted by the Federal Reserve's latest remarks, which have injected a dose of uncertainty. PHOTO BY PIERRE BORTHIRY/UNSPLASH
Bitcoin (CRYPTO: BTC) is headed toward a phase where the cryptocurrency could be confined within a specific price corridor.
According to crypto analyst Cryptonary, the backdrop of the market’s current scenario has been painted by the Federal Reserve’s latest remarks, which have injected a dose of uncertainty.
Market sentiment, as captured by Cryptonary, is reflected in the trading decisions facing investors against the backdrop of intense macroeconomic developments.
The Federal Reserve’s comments, particularly those from Neel Kashkari, have not deterred risk assets from maintaining their resilience.
Kashkari’s musings on the Federal Reserve’s inflation battle suggest a more hawkish future stance than previously anticipated, which has had a subtle yet palpable effect on pre-market activities across major indexes and the Dollar Index.
Turning to the technicalities of Bitcoin’s market position, Cryptonary notes that the cryptocurrency is nudging the lower bounds of its uptrend channel, raising concerns about a possible downturn.
Resistance is pegged at $37,700, while a more immediate support line is drawn at $34,000, followed closely by $33,300.
Cryptonary also shed light on the RSI, which is indicating an overbought state on the daily and 3D timeframes, suggesting the likelihood of a price retraction.
An examination of funding rates and open interest reveals a recent buildup of short positions, as inferred from the long/short ratio.
The narrative of a highly leveraged market is further supported by liquidation heatmaps, which show critical thresholds for short and long positions at $35,600 and $34,000, respectively.
Given the dollar’s uptick, a cautious approach seems to be seeping into the crypto market, dampening prospects for any substantial short-term gains.
Cryptonary postulates that Bitcoin will likely hover within the bounds of $34,000 to $35,600 in the immediate term. This near-term prediction does not foresee any dramatic price breakouts, suggesting instead a state of equilibrium where neither bulls nor bears gain decisive ground.
Produced in association with Benzinga
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