Bitcoin (BTC) is consolidating back into a known range. Currently, neither the bulls nor the bears the upper hand. Fear and uncertainty are still high in the financial markets as bitcoin investors hold onto their BTC tightly. Analysts are also still very divided about which direction the BTC price may go.
Bitcoin Price Consolidates Around $39,500
The bitcoin price dipped all the way to $38,000 on Tuesday night and made a steady recovery on Wednesday and Thursday. As bitcoin arrived at $39,750 yesterday, the price encountered some resistance and was rejected a little later.
Bitcoin then plummeted to $38,950, but then made a hefty bounce. The price then shot to $40,000, but was initially rejected here as well. Bitcoin then bounced at $39,400 and broke through the $40,000 mark this time.
However, that was again short-lived and bitcoin was rejected again around $40,250. Bitcoin steadily declined for the rest of the evening and night. The price briefly found support around $39,800, but it broke early this morning. At the time of writing, the bitcoin price is back at $39,500 on KuCoin and $37,350 on Bitvavo, roughly the same price as 24 hours ago.
DXY fixes something, good news for BTC?
Over the past year, the US dollar index (DXY) has been rising rapidly, especially in recent weeks. However, that meant bad news for many stock markets and also for bitcoin. Meanwhile, the DXY price is finally starting to correct something. The DXY price has fallen in recent hours, but will DXY continue to fall or will the price now find enough support to continue its rise?
The most hawkish action by the Fed at next week’s meeting may already be priced in, and any less severe outcomes could drive #Bitcoin above $42k.
— 𝗡𝗲𝗴𝗲𝗻𝘁𝗿𝗼𝗽𝗶𝗰 (@Ninetropic_) Apr 28, 2022
Bitcoin bulls and bears are pulling on price
So far, we don’t see a very convincing bitcoin yet rebound to make. Should bitcoin now start to rise, it would have to break the area between around $40,500 – $40,700 first and then we may see a retest of the area between $42,500 and $43,000.
However, if bitcoin does not hold up at the moment, it could be that the price is still a lower low makes under $38,000 and then things get really bad bearish to look out. Bitcoin may then plummet all the way to $30,000 or even just below. However, it wouldn’t be a big surprise if bitcoin first consolidates around its current price for a while as it did earlier this year.
Panama passes crypto law
Despite this, there are also many positive signs for bitcoin. Earlier this week, the Central African Republic became the second country on earth to embrace bitcoin as legal tender. Today news comes out that Panama is also enacting a new cryptocurrency law. However, this is not about BTC as legal tender, but it may still have a positive effect on the price. More on this later on Crypto Insiders.
Bitcoin hash rate towards new record
In addition, it appears that the so-called hash rate, or computing power, of the Bitcoin network is again very close to its peak. According to some sources, the hash rate is still just below its peak, but other sources report that it may already be a new all time high reaches. The reason for the reluctance is that these are estimates that are usually corrected later.
Bitcoin Hash Rate reaching new all time highs.
The demand to mine BTC is relentless and thus the network is more secure than ever before. pic.twitter.com/ArFG91QN0a
— Will Clemente (@WClementeIII) Apr 28, 2022
Bitcoin On-Chain Data Shows Huge Outflow From Exchanges
Furthermore, analytics firm IntoTheBlock reports that private investors are finally buying BTC again. The number of wallets with less than 10 BTC has reached a new record. Small addresses in particular increased by at least 2% in the past 30 days.
Retail is buying $BTC
The balance held by addresses with <10 BTC has soared to 2.08m BTC.
— IntoTheBlock (@intotheblock) Apr 28, 2022
But also this group of bitcoin whalesaddresses with 10,000 BTC or more, continues to increase since mid-February, Rekt Capital reports based on Glassnode data:
— Rekt Capital (@rektcapital) Apr 28, 2022
That is accompanied by a declining percentage of the circulating supply of BTC on exchanges. It has declined sharply in the past 30 days, On-Chain College reports:
— OnChain College (@OnChainCollege) Apr 28, 2022
Another strong outflow took place last week and that should lead to less sales pressure, analyst IT Tech reports:
#Bitcoin summing up big inflows and outflows worth to check All Exchanges Netflow from last 7 days (1h chart). Netflow is negative…so selling pressure should decrease, but price is going down.🧐 https://t.co/hx4Atuvv2T pic.twitter.com/vqXJRni1BS
— IT Tech (@IT_Tech_PL) Apr 28, 2022
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Weekly uptrend..Have a good weekend everyone. pic.twitter.com/TolBj4bRk8
— Rickus (@rickus_trades) Apr 29, 2022