- Hopes of a quick Bitcoin recovery following the FTX collapse are fading fast
- Bitcoin has been stuck in the $15,600-$17,000 region for most of November
- A lengthy period of stagnation seems set to continue
The hopes of a quick Bitcoin recovery following its drop to the mid-$15,000s are fading fast after two weeks of stagnation. The collapse of FTX led to Bitcoin crashing to levels not seen for two years, and its weakness at this level shows that a bounce back to the prior level won’t happen anytime soon.
Bitcoin Flatlining
Bitcoin fell to the current level on the back of the FTX collapse, with some suggesting that this was a short-term capitulation and that price would come straight back up again. However, this hasn’t happened, with Bitcoin flatlining as a result:
This lack of direction has been even more obvious when looking at a lower timeframe:
Optimists can point to the fact that Bitcoin has reclaimed the $16,150 region and treated it as support, but in the grand scheme of things this is just another episode of crabbing that Bitcoin typically does at times like this when the market is dead. This is simply full time traders trying to scalp wins here and there to make ends meet, nothing more, and is certainly not the place where amateur crypto enthusiasts should be getting involved (unless they’re buying for a long term hold).
Key Levels to Look Out For
If Bitcoin has any hope of enjoying a bear market rally to $24,000, which is not off the table given past experiences, it needs to clear this obvious area of resistance at $17,550:
If Bitcoin can turn this from resistance to support, then a bounce up towards further levels of resistance is likely. On the flip side, if Bitcoin falls below these lows and can’t get back above, then we could be seeing the next major support at $14,000 come into play:
As always, no one knows what is going to happen with Bitcoin, with plenty saying the bottom is in and others warning that the macro outlook for the economy will drive Bitcoin lower. Because of this uncertainty, dollar-cost averaging down to the $14,000 level is probably a wise option for those who don’t have any exposure as yet, while confirmation above the $17,550 area will be a good springboard to buy in, at least for the short term.
