Trader: BTC price should close above $42,400
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD hitting its lowest levels since September overnight and reaching $40,938 on Bitstamp.
The pair had initially bounced at $42,000 but then renewed its descent, surpassing the floor seen in December’s liquidation cascade.
Among traders, the discussion focused on a similar event occurring, with targets even including a crash below September’s $30,000 lows.
“Could even go lower with a liquidation wick, below September lows,” popular Twitter trader Crypto Ed warned as part of his latest forecast.
At current levels, Bitcoin thus also threatened to disappoint trader Anbessa on daily timeframes.
#Bitcoin price action explained (3/4)
Bearflag channel support hit after fakeout ✔️
Inv H&S support hit again (2nd time) ✔️
While I would tolerate a fakeout to $39.333 intraday
this support right now $42,4k should hold DAILY pic.twitter.com/Qv69dekie9
– AN₿ESSA (@ Anbessa100) January 6, 2022
Macro odds were stacked against both Bitcoin and crypto, commentators argued, headwinds coming from — among other things — events in Kazakhstan, home to an estimated 18% of Bitcoin’s hash rate.
Following mass internet outages across the country this week, hash rate estimates began to show an abrupt dip of around 20 exahashes per second (EH/s) from what were previously all-time highs of 192 EH/s — evoking last year’s Chinese miner exodus.
“The money printer ain’t going BRRR”
Looking forward, others likewise remained subdued on crypto market prospects thanks to macroeconomic policy.
Related: Bitcoin monthly RSI lowest since September 2020 in fresh ‘oversold’ signal
Among them was Arthur Hayes, former CEO of derivatives exchange BitMEX, who pointed at the United States Federal Reserve’s scheduled rate hikes and reduced asset purchases as souring the allure for risk-asset holders.
Easy money, he wrote in a fresh blog post released, is essentially drying up.
The money printer ain’t going BRRR, so #crypto is about to get bludgeoned with a two-by-four studded with rusty nails. Read my essay “Maelstrom” to find out why.https://t.co/qUPq90W4qz pic.twitter.com/sKUA4i9dF5
— Arthur Hayes (@CryptoHayes) January 6, 2022
“Given the law of large numbers, a simple resumption of the previous trend in asset purchases will not cause the growth of the money supply to suddenly and sharply accelerate. Therefore, while risky assets would rejoice — crypto included — the best case is that asset purchases slowly grind higher towards their previous all-time highs,” he claimed.
“Even if that happens, the only way the crypto markets would move up is if the Fed publicly turned on the taps, and then fiat flowed into crypto.”
It remains unknown when the Fed will raise rates, while purchase reductions have already begun.