The Bitcoin market fell rather hard on Wednesday as the $30,000 level has caused a bit of resistance. Ultimately, this is a market that looks as if it is likely to drop over the longer term. The market has a lot of resistance just above, and I think it does make sense that sellers jump in every time we get a little bit bullish. After all, this is a market that has failed miserably as of late and based on the action that we have seen over the last 24 hours, it looks like Bitcoin has further to go.
At this juncture, it looks like the market is going to go reaching towards the $25,000 level, but I think it has further to go than that. Fading rallies will continue to be the way going forward, and at this point, I just do not see a scenario where buying Bitcoin makes sense. The 50-day EMA currently is just below the $38,000 level and dropping rapidly. As crypto continues to get eviscerated, you should keep an eye on Bitcoin even if you are not trading it. It is not until Bitcoin can stabilize that the rest of the market will be able to. At this point, it does not look like it is going to happen anytime soon, so I think what we are going to see is a situation where buyers will have plenty of time to pick up value if and when it occurs.
We are entering “crypto winter” from what I can see, and below the $25,000 level would open up the possibility of a move down to the $20,000 level. After that, the whole thing comes unraveled. There have been a lot of scams exposed in the crypto markets as of late, and now we are even starting to see stable coins get hammered.
I believe at this point it is likely that we have to continue to fade rallies, perhaps shorting given enough time. The market continues to follow risk appetite in general, so it does make sense that the crypto markets fall right along with larger and more liquid markets such as the S&P 500, NASDAQ 100, and “risk on” currencies.
