Bitcoin’s volatility could increase if the price closes below $82,000, the important support level. Investor sentiment is still subdued after the short-term disappointment of the US Strategic Bitcoin Reserve.
The executive order signed by President Donald Trump on March 7th. outlined a plan to create a Bitcoin reserve The use of cryptocurrency confiscated in criminal proceedings by government rather than actively acquiring BitcoinBTC) Market purchases are a great way to save money.
Bitcoin investments by the federal government have been minimal. “led to a near-term negative market reaction and a decline in Bitcoin’s price,” Bitfinex analysts believe that.
Analysts told Cointelegraph that Bitcoin must close this week above $82,000 to prevent a decline in price due to short-term disappointment among investors.
“Investors had anticipated that federal accumulation of Bitcoin would signal strong institutional support, potentially driving prices higher. However, the reliance on existing holdings without additional investments has tempered these expectations.”
“It demonstrates the sensitivity of cryptocurrency markets to government actions and policies,” The analysts also added.
BTC/USD, 1-month chart. Source: Cointelegraph
Bitcoin’s price has been stagnant since Trump held the first Bitcoin summit on March 7. Since then, Bitcoin is trading below the psychological $90,000. White House Crypto Summit.
Investors may be re-evaluating Bitcoin’s sentiment after the week closes above $82,000. They are still analyzing the details of Trump’s Bitcoin reserve proposal, and may even include it. “budget-neutral strategies” Buy more Bitcoin
Related: Trump turned crypto from ‘oppressed industry’ to ‘centerpiece’ of US strategy
Bitcoin prices are affected by macroeconomic variables
Bitcoin prices continue to be influenced by macroeconomic events, outside of crypto-related legislative announcements. global trade concerns, Iliya Kachev, dispatch analyst of digital asset investing platform Nexo.
Bitcoin’s “short-term movements will be heavily influenced by macroeconomic factors,” The analyst tells Cointelegraph
“Next week, all eyes will turn to key US economic events, including the Consumer Price Index, which is expected to signal a slowdown in inflation, and the job openings report, which will serve as a key indicator of labor market strength and the potential for interest rate cuts.”
Related: Rising Bitcoin activity hints at market bottom, potential reversal
Even so, crypto markets may experience significant volatility if the weekly closing price falls below $82,000.
Bitcoin Exchange Liquidation Map. Source: CoinGlass
If Bitcoin were to fall below the current level, this would result in a cumulative liquidation of leveraged long positions worth over $1.13 Billion across all exchanges. CoinGlass Data shows
A key technical indicator called the relative strength (RSI) can indicate whether Bitcoin is nearing a local bottom. It measures whether a currency has been sold too low or bought to high.
BTC/USD, 1-day chart, RSI. Source: Rekt Capital
The RSI for Bitcoin was 28. This indicates that the asset has been oversold. Bitcoin prices would increase each time Bitcoin’s RSI reaches 28 in this cycle. “either bottom or be between -2% to -8% away from a bottom,” Rekt, a popular cryptocurrency analyst wrote in an article published on March 8, X. post.
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Source: cointelegraph.com
