Bitcoin (BTC) is on the edge of the cliff once again. The last chance saloon of around $55,800 is all that is holding Bitcoin up. If the price falls through this last support, there is nothing to catch it before it falls to $52,000. Is the plunge about to take place?
Jobs data out on Friday - 50 basis point rate cut becoming likely?
With a nervously awaited non-farm payroll report being released later on Friday, and the U.S. stock market showing anticipatory weakness, there’s not much good news to spur the Bitcoin price.
U.S. jobs data has taken over from inflation as the new priority for the Federal Reserve, and recently published figures, and especially the later downward revisions in this data, are giving cause for huge concern. The CME fedwatch tool, which displays the market expectations for future Fed rate cuts, is showing that the market is starting to believe that a 50 basis point rate cut this month is fast catching up with the Fed projection of 25 basis points - now 45% for 50bps against 55% for 25bps.
Over at the Spot Bitcoin ETFs, things aren’t looking too good either. A further 3.64K $BTC was sold out of the ETFs on Thursday, making this the seventh straight day of net outflows.
Short term price in downward-sloping wedge
Source: TradingView
In the short term time frame the $BTC price is in a downward-sloping wedge pattern. It just remains to be seen whether the price will continue and fall out of the bottom of this pattern, or whether the bottom of the wedge, plus the horizontal support, can hold it up.
A confirmed break below this level would make it extremely likely that the price would then fall directly to the $51,000 support. However, if this support can hold, the pattern is a bullish one, and a break out of the top of the wedge would give bulls some respite. The next few hours will be critical.
$51,500 lines up perfectly with fib level
Source: TradingView
Zooming right out into the macro time frame of the monthly chart, it becomes a lot clearer as to the potential targets for this downturn. Currently at the last-ditch support, if the price falls through, the $51,500 support lines up exactly with the 0.382 fibonacci.
Therefore, if the price did come down to this horizontal level, looking at it from a macro perspective, this would be a very normal retracement, and a bounce from this support would be bullish. However, if the price fell through and the $42,000 support didn’t hold, the main 0.618 fibonacci is below, at just under $38,000 …
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
