Bitcoin reclaims $20,000 amid tight regulations

The relative strength index (RSI) is at an all time low indicating that sellers are getting exhausted at this level.
Bitcoin
Bitcoin
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After trading at sub $20,000 for the past few days, Bitcoin (BTC) reclaimed the crucial psychological level at $20,000 briefly today. BTC’s move has stimulated relief rallies across most crypto assets as the total crypto trading volumes surged by more than 40%. However, as positive as it may look, centralized decentralized companies (Ce-DeFi) continue to receive insolvency pressures as lending business models during bear markets appear to be broken. Vauld, a crypto platform with Indian operations offering higher returns on stablecoins and other crypto, has announced suspension of trade and withdrawals. In addition, India’s 1% TDS implementation has brought down trading volumes across major exchanges. 

In this article, we will take a look at the price actions of major crypto assets along with short-term outlook for Bitcoin. 

Bitcoin reclaims $20,000

BTC has been trading under moving averages (resistance levels) for quite some time as selling pressures continue to build up. After gaining support from the bulls, BTC managed to break above $20,000 today though it has now dropped below that level. The 20-day exponential moving average (EMA) at $21,200 needs to be broken to signal a strong uptrend to the entire crypto market. The relative strength index (RSI) is at an all time low indicating that sellers are getting exhausted at this level. 

Altcoins sigh a relief

Ethereum (ETH), the second-largest crypto asset, bounced back strongly by 9% in the last 24 hours as soon as BTC mounted a comeback. In fact, the global crypto market cap gained by 5% to stand at $913 billion as most of the altcoins piggybacked on BTC’s move. Among the top 20 altcoins, Solana (SOL), Polygon (MATIC) and Uniswap (UNI) had the sharpest rebounds by more than 10% taking a break from the bearish phase. 

MATIC’s bullishness arises from the developments that the Polygon team has put in place. The Polygon ecosystem is growing faster, including the DeFi ecosystem. The network supports many DeFi products and projects that will likely create the demand for the coin. The Polygon ‘Green Manifesto’ is still a major thing in the crypto market. The new Polygon program aims to make the Polygon network eco-friendly. Polygon is introducing gasless minting of NFTs on its network. 

Uniswap’s (UNI) surge comes from its strong fundamentals as the decentralized protocol has been able to provide better liquidity than most of the centralized DeFi companies during one of the toughest bear markets crypto market has ever witnessed. Solana (SOL), though plagued by centralized issues, had a relief bounce as major institutions continue to believe in its ability to deliver better performance in the next bull market. 

Short-term outlook for Bitcoin

Inflation has been a major concern globally as the central banks continue to have a hawkish outlook on the economy. The US Federal Reserve has been raising interest rates continuously to beat one of the highest inflation it has ever seen. With such monetary brakes in the backdrop, risky assets like tech stocks and crypto are unlikely to accrue value in the short term. Relief bounces are expected to occur with high volatility and trading in these conditions invites unwarranted risk. Investors are advised to determine the levels at which they think is better to buy and deploy capital that is not needed for the immediate future.

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Disclaimer: This article was authored by Giottus Crypto Exchange as a part of a paid partnership with The News Minute. Crypto-asset or cryptocurrency investments are subject to market risks such as volatility and have no guaranteed returns. Please do your own research before investing and seek independent legal/financial advice if you are unsure about the investments.

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