Bitcoin (BTC), hovered at $43,000 on February 11, as volatility declined after a new local peak.
BTC/USD 1-hour candle charts (Bitstamp). Source: TradingView
The support and resistance zones are narrower
TradingView and Cointelegraph Markets Pro data showed that BTC/USD was waiting for a trigger to test support or resistance near Wall Street on Friday.
After Thursday’s U.S. CPI data and the subsequent volatility, traders had to make difficult decisions for the largest cryptocurrency. This caused pain for both longs as well as shorts, as 24 hour liquidations reached $200 million across crypto.
The inflation story is still alive and well, so attention now turns to the timing of Federal Reserve rate increases.
Markets have already priced in rate increases. But, the markets will be affected if there is an unexpected rate increase or acceleration in the rate hikes. This could cause shock reactions and possibly lead to a market collapse. Michael van de Poppe, a Cointelegraph contributor, stated that traders should remain calm.
Scott Melker, a fellow trader and analyst, is known as the “Wolf on All Streets” because of his observation of the narrowness in the current chart layout for lower timeframes. Support and resistance are evidenced at a relatively short distance from the spot.
$BTC 4-Hour Lots of supply and resistance over $45,000, according to the upwicks. According to the downwicks, there is tons of demand and support in low $43,000s. pic.twitter.com/QAAIVSXJkG
— The Wolf Of All Streets (@scottmelker), February 11, 2022
Another popular commentator Anbessa felt it was time to pay more attention to sentiment and price action than fundamentals to help navigate the future moves.
“Don’t fight with the market. Forget all fundamental talk. He tweeted Friday Price Action (+sentiment),” he said, while retaining a mid-term target just above $48,000.
Wall Street saw the S&P 500 open down, before a slight recovery. This was in continuation of the CPI readout, which reported 7.5% annual inflation — another high 40 years ago.
Chart bulls need more fuel
Two more moving averages are another short-term signal that joins the bullish trend.
Related: Bitcoin metrics require BTC price gains, as analysis calls for near-term caution’
The positive-looking 200-day exponential moving Averages (EMAs), and the 50-day exponential moving Averages (EMAs), are joined by the 100- and 200-period EMAs of the 4-hour BTC/USD charts.
According to Phoenix’s Twitter account, the two are set to cross over. This is a move that last year led to significant price increases.
The account was summarized Friday as “The Trend is Your Friend.”
“The 100 EMA is poised to cross the 200 (4h tf). If this happens, they will be in full bull mode once again. This happened only twice in ’21: beg and eo July. Oct. Backcheck Choppy prices – They want you to shake them out.”
BTC/USD 4-hour candle charts (Bitstamp), with 100-day EMA and 200-day EMA. Source: TradingView
Cointelegraph reported that Bitcoin’s MACD indicator has also been printing a rare bullish pattern for this week.