This remains a “fade the rallies” type of situation, waiting on the breakdown to pick up momentum to the downside and truly open up massive selling.
Keep in mind that Bitcoin needs a lot of risk appetite out there in order to send this market higher. Bitcoin is about as speculative as it gets for most institutional investors, so until we start to see some time going higher in risk assets, Bitcoin is going to struggle in general. It’s a bit ironic, but Bitcoin needs the Federal Reserve to come along and loosen monetary policy in order to bail it out. In other words, now that Bitcoin has gotten so big, it has become another asset like anything else, perhaps with a little bit wider volatility.
If we were to break down below the $18,000 level, it opens up the possibility of a move down to the $15,000 level next. After that, we have the $12,000 level where the most recent bull market has started from. That would be a complete “round-trip”, which is nothing new for the crypto market, nor is it new for Bitcoin in general. I think at this point, that is the most likely scenario, so I’m not necessarily interested in trying to buy Bitcoin, because I believe it’s only a matter of time before we see US dollar strength cause major issues as it has for some time.
Even if we do rally from here, we would need to break above the $25,000 level in order to make any type of serious statement that I would have to pay attention to. This remains a “fade the rallies” type of situation, waiting on the breakdown to pick up momentum to the downside and truly open up massive selling. Do not get me wrong, eventually I will be accumulating Bitcoin, but we are nowhere near that right now as the financial situation does not help the idea of taking massive amounts of risk at this point in time.