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Bitcoin (BTC) technical and fundamental analysis 04.12.2023

📈 Technical analysis BTC/USDT

The price of Bitcoin has broken the upper boundary of the parallel price channel it has been in for over a month with an impulsive movement. Currently, we are witnessing a test of the resistance level at 42,000, upon which the further direction of the price movement depends. If BTC consolidates above it, we expect the formation of a new price range of 42,000 - 44,000. From there, new impulsive price movements towards the next target of a significant resistance block at 48,000 are possible, which could serve as a trend reversal level. In this zone, we will be looking for reversal patterns to initiate short positions.

However, it's worth noting that nearly two months of upward movement have occurred with minimal retracement. RSI indicators are in the overbought zone, increasing the likelihood of a local correction before the continuation of the uptrend. If, under selling pressure, the price consolidates below the level of 38,500, we would expect a correction in the range of 0.38-0.5 Fibonacci levels. A retest of the global ascending trendline may occur in this range. Additionally, this area includes the 1W Imbalance zone, where it's necessary to close gaps at horizontal levels of trading volumes.

📉 Bitcoin market global analysis

The price of Bitcoin has precisely reached the 0.5 Fibonacci correction level from the entire decline since reaching its all-time high (ATH) in 2021. The next growth target is the 0.61 Fibonacci level, where a strong resistance level is also located.

On the daily logarithmic chart, momentum indicator readings suggest that Bitcoin is already in the overbought zone, and 42,000,  45,000, 48,000 levels may pose strong resistance. The RSI indicator has formed a bearish divergence, indicating the need for a local corrective movement. The acceleration of the latest upward impulse, like the previous ones, occurred during short sellers' position liquidations. However, this is the smallest of the liquidations since BTC broke above 30,000. Thus, the impact of this growth factor is also weakening.

If sellers push below the support level of 38,500, we would expect a correction of the entire uptrend since the beginning of this year to the 0.5 Fibonacci level and a retest of the 200-week moving average. In the same area, the weekly Imbalance zone is located at 34,000-31,000.

However, on a global scale, the BTC price is forming patterns that preceded bull markets in previous cycles.

💠 Analysis of zones and levels for making trading decisions

The Fear and Greed Index is in the greed zone at 74.

The total market capitalization of the cryptocurrency market has increased to 1,501 billion dollars, and the Bitcoin dominance index has risen to 54.2.

According to the analysis of the accumulation of large order blocks in exchange order books, extreme liquidity is at the level of 38,500, and demand and supply zones are located at the following levels:

🟢 Demand Zone:  30,000 - 35,000

🔴 Supply Zone:     41,000 - 48,000

Levels for long positions:

38,500 - significant support block

34,000-35,000 - possible retest zone of the trendline

30,000 - psychological support level

28,000 - retest of the 200-week moving average

Levels for short positions:

45,000 - significant resistance block

48,000 - 0.61 Fibonacci correction level

📊 Fundamental analysis

According to CoinShares, over the past 10 weeks, the inflow of funds into the cryptocurrency market has reached $1.7 billion. However, regulatory crackdowns on crypto companies may delay the start of a bull market if investors begin to divest from cryptocurrency assets. In light of negative news, Binance users actively withdrew funds from the platform last week, resulting in a net outflow of $1.2 billion in just 24 hours. However, news of the approval of a spot Bitcoin ETF could provide another powerful growth catalyst.

Over the last six months, Bitcoin (BTC) miner revenues have dropped by more than 30%, with November earnings approximately $270 million less than those in October. The decline is attributed to the volatility of the leading cryptocurrency, intense competition, and rising electricity prices. Considering that Bitcoin's mining reward will halve again after the next halving, it's straightforward to calculate the BTC price required for mining to remain profitable.

The stock market positively responded to Jerome Powell's recent statements. Additionally, the inclusion of Uber in the S&P500 index boosted investor confidence, contributing to further S&P500 growth. Currently, it is undergoing a retest of the 4600 level.

🌐 Upcoming Events in the Global Economy

The following dates are expected to bring increased volatility in both the stock and cryptocurrency markets:

➤ December 13, 2023, 21:00 - New Fed Interest Rate Decision.

➤ January 31, 2024, 21:00 - New Fed Interest Rate Decision.

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