Bitcoin (BTC) starts its first full week of December at three-week highs as bulls and bears battle on.After a weekly close just above $17,000, BTC/USD
Bitcoin (BTC) starts its first full week of December at three-week highs as bulls and bears battle on.
After a weekly close just above $17,000, BTC/USD seems determined to make the most of relief on stocks and a weakening U.S. dollar.
As the United States gears up to release November inflation data, the dollar looks to be a key item to watch as BTC price action teases a recovery from the pits of the FTX meltdown.
All may not be as straightforward as it seems — miners are facing serious hardship, data shows, and opinions on stocks’ own ability to continue higher are far from unanimous.
As the end of the year approaches, will Bitcoin see a “Santa rally” or face a new year nursing fresh losses?
Cointelegraph presents five areas worth watching in the coming days when it comes to BTC/USD performance.
Bitcoin traders diverge over “Santa rally”
Light relief for Bitcoin bulls this week comes in the form of a solid weekly close followed by an uptick to multi-week highs.
BTC/USD hit $17,418 on Bitstamp in the hours after the close, taking the pair to its highest levels since Nov. 11, data from Cointelegraph Markets Pro and TradingView shows.
For traders, there is reason to believe that short-term strength may hold, allowing Bitcoin to head closer to $20,000.
“No change to my expectations. Still looking for 19k+,” Credible Crypto confirmed to Twitter followers on Dec. 4.
“$BTC has formed a nice tight consolidation here after a clean impulse on low time frame. May dip into 16k’s first to take out these built up lows but still expecting continuation up after regardless.”
Fellow trader Dave the Wave meanwhile put faith in a Christmas rally coming next, while others, including popular commentator Moustache, said that the time was historically right for recovery.
Comparing the 2022 bear market to previous ones, he explained that BTC/USD should now be finding a bottom, 31 weeks after its last all-time high.
“The Bitcoin bottom should be very close,” he reiterated at the weekend.
Not everyone, however, is so optimistic. For Crypto Kingpin, there is room for a move to $18,000 before Bitcoin starts “heading lower.”
While not mentioning exact downside targets, he described the weekly close as “conflicting.”
“im still of the belief for now that this move up on btc is part of a corrective abc w4 before making a new low sub $15k into Q1 2023 where we find a longer term bottom,” another popular trader, Bluntz, tweeted after the weekly close.
Similarly conservative on lower timeframes is trader Korinek_Trades, who despite calling for a “huge relief bounce” on Bitcoin acknowledged that downside could take it as low as $12,000.
Crypto voices cautious on stocks amid “imminent” crash claim
The coming week in macro marks the precursor to the all-important U.S. Consumer Price Index (CPI) print for November, due Dec. 13.
In the meantime, U.S. Producer Price Index (PPI) and jobless data later in the week will be dates to watch for traders, these traditionally sparking at least short-term volatility.
Eyeing U.S. equities, meanwhile, the tone among crypto traders and beyond appears tense, despite recent strength in the face of a declining dollar.
The S&P 500 (SPX) finished the week prior up 1.66% at 4,071 points.
“Unless we take out 4,300 on volume and stay above, this to me is a propped-up rally. Could take a few weeks to climb mind,” Crypto Tony warned over the weekend.
An additional tweet revealed doubts about Bitcoin avoiding knock-on effects despite already significantly underperforming stocks in the wake of FTX.
“This is a very plausible scenario,” Crypto Tony commented alongside a chart.
“If we do indeed see a continuation crash in the stock market due to high interest, defaults etc, I expect Bitcoin to follow. Until then we will simply range in my opinion while there are minimal buyers.”
That sentiment echoed a forecast from popular commentator, Nunya Bizniz, who earlier suggested that the SPX may put in a “Santa rally” before reversing.
The starkest outlook on equities came from Michael A. Gayed, the renowned portfolio manager and author of investment strategy circular, “The Lead-Lag Report.”
In an extensive Twitter digest on Dec. 3, Gayed went beyond caution, telling readers that an “imminent stock market crash” was next.
“My point is that there are lags and that markets have a funny way of surprising the crowd out of nowhere,” part of one post read.
“It is not impossible to see a scenario where the butterfly creates the hurricane.”
He added that FTX had itself created unusual market responses even beyond crypto.
Miners already in “giant capitulation”
The FTX saga is beginning to show itself in the struggles of Bitcoin miners to an increasing extent.
The latest data…
cointelegraph.com