Bitcoin has failed to break over the downward trendline that has been in place ever since its drop to $3,850 over two weeks ago, suggesting that a drop back to the $5,000s is looming. Meanwhile the rest of the market remains in a sense of stasis, awaiting Bitcoin’s next move, with the potential of medium-term ranging a distinct possibility.
Bitcoin had been engaged in a downward trend since March 11, racking up four rejected breakouts, and now seems to be following a path down to retest previous supports. The $5,600-$5,800 region is where strong support can be found, meaning that if Bitcoin breaks past this region then that would symbolize a real lack of faith and potential further downside to around $4,000.
On the positive side, the record drop in the Bitcoin hash rate that has seen it plummet 22% in 12 days has been arrested, with the rate stabilizing around 95 million terahashes and creeping back over 100 million in the past 24-48 hours:
Image courtesy of blockchain.com
This is a welcome development that suggests that any spate of miner capitulation could well be over, and the slack is being picked up by other mining farms, which could eliminate a source of Bitcoin selling.
Market in Stasis
The rest of the market is still in a sense of stasis, except Toilet Paper Token (TPT) which has enjoyed an incredible 1,124% move over the past 24 hours due to continued panic buying:
Suggestions are however that such a jump is nothing more than a flash in the pan for what is generally regarded as a shitcoin, and that those gains will be flushed away once the coronavirus pandemic eases off a little.
The rest of the crypto market looks to be still waiting on a move from Bitcoin, with alts in a precarious position. Very few setups are tempting at the moment, with even those that could have some upside having the potential to be swept away by Bitcoin’s next move.
Instead, as we have seen for the past few weeks, it might be a case of just sitting on the sidelines and waiting to see what plays out before being able to have any convictions on any setups.