The Bitcoin price is trending to the downside and seems on track to retest its annual lows at $15,550. The nascent active class faces the fallout from the collapse of the FTX. Once the world’s second largest crypto trading platform, the company has filed for bankruptcy protection.
As of this writing, the Bitcoin price is seeing massive selling pressure. The cryptocurrency is trading at $15,900 with a 4% and 2% loss in lower and higher time frames. BTC has been more stable than other assets in the crypto top 10 by market cap.
In contrast, Ethereum (ETH) recorded a 10% loss during the previous week, while Cardano (ADA) and Dogecoin (DOGE) recorded a 9% and 14% loss, respectively, during the same period. Other cryptocurrencies follow this trend except XRP, which still maintains some profits.
A Low Volume Week Could Be A Headwind For The Bitcoin Price
The general sentiment in the market seems biased towards another flash crash. However, the US market may become less active in the coming days.
The country will begin its Christmas holidays this week as its citizens celebrate Thanksgiving. Thus, the market could see low trading volumes.
According to an an analyst of Material Indicators, the long holiday week could extend the losses in the price of Bitcoin and the crypto market, especially these days of heavy pessimistic sentiment and negative news in the nascent asset class:
Note, it is a holiday week in the US so volume may be light. Could see some Q4 tax loss crop in TradFi contributing to the downward momentum in Crypto fueled by FUDscam related FUD contagion.
The analyst shared the image below and showed the order book of crypto exchange Binance. In this trading venue, the bid (buy) side seems thicker.
At the time of writing and on higher time frames, many more buy orders could act as support for the Bitcoin price. In this sense, Material Indicators and others believe that the crypto market is bound to sideways price action.
This theory could be invalidated if there is new negative news related to the collapse of FTX or the contagion devastation throughout the industry. According to rumors circulating across social media platforms, there is a high risk that a major crypto company will file for bankruptcy in the coming days.
The macroeconomic landscape is improving, with US inflation finally peaking. According to Fidelity Macro analyst Jurrien Timmer, this inflation peak will positively affect the markets. The crypto market could rebound if the bulls can defend the current range and the previous year’s lows.
Eye on 2023: If Inflation has peaked for this cycle (on a variable rate basis), we should reach a “Pintman Fed” of around 5% in the next quarter or two. After constant movement of the monetary targets this year, this should at least provide some clarity. pic.twitter.com/rGaZRNfaQK
– Jurrien Timmer (@TimmerFidelity) November 21, 2022
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