Bitcoin is out of the uptrend channel

22 August 2023 160
Bitcoin is out of the uptrend channel

Bitcoin is adding to losses accumulated during the token’s worst week since last November, as the outlook for prolonged Fed interest rate hikes reduces demand for risky investments in global markets. The largest digital asset (BTCUSD) dropped by nearly 1%, sliding below the $26,000 level in the previous session.


According to CoinMarketCap data, the total cryptocurrency market capitalization fell 0.06% to $1.05 trillion in the last 24 hours, while the market size dropped 1.40% to $22.91 billion.


10-year Treasury bond yields have reached the highest level last recorded in November 2007. This is happening on the background of sustained economic growth in the U.S. that supports expectations of maintaining high interest rates by the Fed for a prolonged period of time. Such a backdrop signals limited liquidity. This might cause problems for more riskier assets, such as shares and cryptocurrencies.


Central bank leaders are due to meet at the Federal Reserve's annual symposium in Jackson Hole this week. Fed Chairman Jerome Powell's comments, expected on Friday, will be closely monitored for any signs of further monetary policy.


Meanwhile, Bitcoin miners are looking for new areas to expand their business. They are also providing high-performance computing services in the fast-growing artificial intelligence (AI) market. This allows them to reduce their dependence on cryptography.


Currently, it is not necessary to assess the outlook for the upward movement of the digital asset prices, as the coin has broken through the upward support on the D1 timeframe. To resume the bullish momentum, the BTCUSD rate should rise to $28,000. This is unlikely at the moment.


The Relative Strength Index (standard values) confirms the current short-term downtrend of the cryptocurrency rate in convergence. Further decline to the support level of $21,750 is expected.


Signal:

The short-term outlook for the BTCUSD pair suggests selling.

The target is at the level of 21,750.

Part of the profit should be taken near 24,850.

The Stop-loss is set at 29,770.

 

Bearish trend has a short-term character, so the trade volume should not be more than 2% of your balance.

This content is for informational purposes only and is not intended to be investing advice.

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