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Source: Сointеlеgrаph

Bitcoin (BTC) showed weakness at the Jan. 25 Wall Street open as US stocks fell in step.

Hourly candlestick chart BTC/USD (Bitstamp). Source: Trading View

BTC Price Faces Tough Resistance

Data from Markets Pro and TradingView showed BTC/USD falling below $22,500 after failing to clear resistance near five-month highs.

US stocks started the session weakly, with the S&P 500 and Nasdaq Composite down 1.1% and 1.6%, respectively, at the time of writing.

Bitcoin bulls themselves ran into trouble trying to move into the liquidity area above $23,400, which is still unchallenged and home to a significant number of potential short liquidations.

Traders remained on guard, hoping that a clearer trading signal would emerge after a few days of sideways price action.

“This is what I’m looking for in bitcoin with a corrective wave now followed by another leg to my $25,000 total,” Crypto Tony commented along with an explanatory chart.

“Invalidity is if we started to break from here.”

Annotated BTC/USD chart. Source: Crypto Tony/Twitter

contributor Mikael van de Poppe also chose to wait and see that day.

“Wait patiently for bitcoin to drop below $22.3k or break and bounce back to $23.1k. I don’t see anything interesting in between,” he told followers on Twitter.

Some bullish predictions remain, including one from Crypto Ed who foresaw a potentially higher low for BTC/USD, setting the stage for new highs.

Fellow trader Kaleo even suggested that $30,000 would be Bitcoin’s next target.

Bitcoin correlation with golden splash

A topic of interest beyond price action, meanwhile, has focused on Bitcoin’s correlation with both gold and equities.

Related: Bitcoin to face ‘significant danger’ from the Fed in 2023 – Lyn Alden

Charles Edwards, CEO of crypto investment firm Capriole, noted that Bitcoin is continuing its historic trend of “playing catch-up” with gold.

“There is a connection between bitcoin and gold and gold is being pumped,” he wrote.

“When you’re behind the price of gold, it’s easier to see. Bitcoin tends to rise between 0-6 months after gold and bottom out 0-3 months after gold. This gap is approximate and is likely to narrow over time.”

Annotated chart of BTC/USD vs XAU/USD. Source: Charles Edwards/Twitter

The correlation of bitcoin to gold that day was almost 100%.

BTC/USD vs XAU/USD chart. Source: Trading View

Conversely, Kaleo was hoping for a “decoupling” from the S&P 500 and Bitcoin was poised for a breakout higher.

“BTC broke HTF resistance related to ATH Nov 21 ~ two weeks ago,” the next tweet reads.

“It looks like it is set to continue this trend as it is currently on the verge of breaking out of the pennant it has been accumulating in the above support.”

Annotated chart of BTC/USD vs S&P 500. Source: Caleo/Twitter

The views, thoughts and opinions expressed here are those of the authors only and do not necessarily reflect or represent the views and opinions of .

Source: Сointеlеgrаph

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