At the time of writing this article, the king crypto currency unit was at $42,445 and it fell rapidly to $40,400 about 8 hours ago. We had mentioned a few days ago the bill targeting crypto by senators as the financing of terrorism. Apart from this, there was no major event that triggered the fall in the markets, but we mentioned that there might be profit sales during the Fed week after the recent employment data.
Will Cryptocurrencies Rise?
About 30 hours ago, we said that the agenda was extremely busy on the macro front as of Monday and that the Fed could be annoying after the strong employment data, which would trigger profit sales. So it happened, markets fell before the new inflation data, with the curse of bad data coming on Friday.
The cumulative value of cryptocurrencies (TOTALCAP) has rapidly increased since October, creating eight consecutive weeks of rising candles. The recent peak continued up to 1.63 trillion dollars. The highest level is very close to the point where the resistance levels of 1.60 trillion dollars come together. With the rejection in this region, the first falling candle starts to form after a long rise. As we always say, getting caught in the constant rise or fall feeling is misleading.
If the cumulative value can exceed the resistance of 1.6 trillion dollars, it can reach the peak of 1.87 trillion dollars. In the opposite scenario, we could follow a destructive fall process down to 1.25 trillion dollars.
Bitcoin (BTC)
Bitcoin has also experienced a similar process to the cumulative value graph of cryptocurrencies. The annual ATH level occurred above the resistance region of $42,450. Despite the increase, BTC could not continue its upward movement this week and the expected withdrawal was triggered towards this region. Of course, the flow of news also had an effect on this.
Whether there will be closures above the critical resistance area will determine the direction of the trend. This week will be busy, but the bulls need to take back the resistance region and make closures on it. The price was exactly in the resistance region at the time of writing.
On the other hand, closures under resistance can result in a drop to $36,000. In this case, we might see much bigger losses in altcoins. Investors, especially in altcoins, need to be prepared for an increase in volatility.
