Bitcoin clings to $42K as key moving average break from July reappears

Bitcoin
(BTC)
consolidated
above
$42,000
prior
to
Wall
Street’s
opening
bell
on
Jan.
7
as
more
similarities
to
last
year’s
lows
emerged.


BTC/USD
1-hour
candle
chart
(Bitstamp).
Source:
TradingView

BTC
“very
closely”
mimicking
May
behavior

Data
from

Cointelegraph
Markets
Pro

and

TradingView
 tracked
a
nervous
Bitcoin
market
as
BTC/USD
avoided
another
retest
of
$40,000
support.

Earlier,
after
briefly
falling
below
$41,000,
analysts
had

warned

that
a
further
capitulation
event
may
occur,
this
having
the
potential
to
bring
the
pair
down
to
$30,000
or
even
lower.

That
figure
rings
true
for
market
participants,
having
formed
the
bottom
of
a
protracted
capitulation
which
lasted
from
May
to
July
last
year.

Then,
as
now,
the miner
upheaval
combined
with
macroeconomic
factors

to
temporarily
take
the
momentum
out
of
the
Bitcoin
bull
market.

“BTC
is
following
May
2021
very
closely,”
trader
and
analyst
Rekt
Capital
noted
in
a
series
of
tweets
on
current
price
action.

He
noted
that
as
of
Friday,
BTC/USD
was
performing
a
break
of
the
50-week
exponential
moving
average
(EMA)

just
like
the
mid-July
move
which
formed
the
bottom
of
that
capitulation
phase.
The
50-week
EMA
sat
at
$45,000
on
the
day.

Cointelegraph
contributor
Michaël
van
de
Poppe
meanwhile
noted
the
differences
between
the
two
phases.

A
“swift
correction
south”
this
time
around
means
that
prolonged
sideways
movement
and
breakout
to
the
upside
from
2021
does
not
overall
characterize
the
current
market.

“The
$46,000
level
remains
a
very
important
one
to
watch.
If
that
one
breaks,
I
think
the
entire
bear
market
is
over
or
the
entire
correction
is
over
and
we’re
looking
for
upwards
potential,”
he

said

during
his
latest
YouTube
update.

Ethereum
has
trader
planning
$2,200
buy-in

Altcoins
also
saw
trouble
on
the
day,
following
warnings
that
any
strong
moves
previously
were
likely
a
red
flag

a
bull
trap.



Related: ‘Dip,’
‘Buy’
and
‘Fed’
top
trending
topics
on
social
media,
per
survey

Ether
(ETH),
the
largest
altcoin
by
market
cap,
traded
down
4.5%
at
the
time
of
writing
to
near
$3,000

down
$700
in
a
week.


ETH/USD
1-day
candle
chart
(Bitstamp).
Source:
TradingView

Some
in
the
top
ten
cryptocurrencies
by
market
cap
escaped
the
downtrend,
with
Cardano
(ADA)
up
1.2%
at
$1.23
and
Ripple
(XRP)
flat.

A
still
highly
cautious
Pentoshi

identified

levels
as
low
as
$2,200
for
buying
ETH,
expecting
it
to
hit
at
“some
point
this
year.”

read original article here