The short-term outlook for the coin is neutral.
- Sell the BTC/USD pair and set a take-profit at 19,000.
- Add a stop-loss at 23,000.
- Timeline: 1-2 days.
- Set a buy-stop at 21,500 and set a take-profit at 23,000.
- Add a stop-loss at 20,000.
The BTC/USD price drifted upwards as the market mood improved. The pair rose above the key resistance level at 21,000 for the first time since last week. The current price is about 20% above the lowest level during the weekend.
Market Mood Improves
Bitcoin had a terrible weekend as its price crashed below $19,000 for the first time since 2020. This decline happened as investors continued worrying about the coin’s demand amid a high-interest rate environment. It also coincided with the worst week for stocks since 2020 as the S&P 500 moved to a bear market.
The BTC/USD pair has risen in the past three straight days as mood among investors started improving. This is evidenced by the fact that the closely watched CBOE Volatility Index (VIX) has pulled back sharply this week.
At the same time, stocks are doing well. As Bitcoin held above $21,000, American shares did well, with the Dow Jones rising by more than 600 points. The Nasdaq 100 index, on the other hand, rose by more than 400 points. In the past few months, Bitcoin has had a close correlation with American shares.
The BTC/USD pair is also holding steady as FTX took some measures to stabilize the market. In a statement, the company announced that it was lending $250 million to BlockFi, a crypto lender that has come under strain in the past few days.
Celsius, another cryptocurrency lender, has been forced to suspend withdrawals as it restructures its business. In hopes that the project will bounce back, its cryptocurrency has risen by more than 1,200% in the past few days.
Still, it is unclear whether this recovery will be sustainable in the long term. Some analysts believe that it is a dead cat bounce as investors buy the dip.
The four-hour chart reveals that the BTC/USD pair has been attempting its recovery. It has found some resistance at the pivot point. Also, the coin is between the 25-day and 50-day moving averages while the Relative Strength Index (RSI) has tilted upwards. The price is also approaching the Ichimoku cloud.
Therefore, the short-term outlook for the coin is neutral. A move above the resistance level at 22,000 will be positive and signal that there are still more buyers in the market. At the same time, a drop below 20,000 cannot be ruled out. If this happens, Bitcoin will retest the weekend low of below 18,000.