Bitcoin Weekly Review
The week for bitcoin started great, but ends on a minor note. In the first half of the week, the BTC/USDt pair rose to $18387 in anticipation of the results of the US Federal Reserve meeting. The appetite for risky assets kicked up after the publication of the inflation report for November. Inflation in the US slowed down and strengthened expectations that the Fed will slow down the pace of rate hikes at the December meeting.
As expected, on December 14, the Fed raised rates by 50 basis points, but in its forecasts, the regulator made it clear that it would raise rates higher than the market expected. Rates will remain high until the authorities are "really confident" that the decline in inflation is sustainable.
After the speech of the head of the US Federal Reserve, US stock indices closed in the red, and the yield on US Treasury bonds also declined. A bearish candlestick setup has formed for bitcoin (a pinbar is a candlestick with a long upper shadow), which began to work out in the second half of the week. On December 15, Bitcoin fell by 2.51%, to $17,356, and on December 16, by 4.17%, to $16,527.
With a break of $17,230 (trendline from $15,476 low), the New Year's rally ended. Powell scared the markets, so the decline in stock indices resumed. Cryptocurrencies fell further amid reports from Bloomberg that the audit firm Mazars Group has suspended work with all clients from the crypto industry after checking Binance's bitcoin reserves. Although Binance disclosed information about its cryptocurrency reserves after the collapse of FTX, investors continue to withdraw money from the exchange on fear of charges. The exchange is suspected of links with the Chinese Communist Party, money laundering and deliberately contributing to the collapse of FTX.
Binance founder Changpeng Zhao (CZ) said in an interview with CNBC that the exchange has sufficient liquidity and will not experience problems if clients withdraw 100% of their assets. Zhao also explained that the financial review was partial because many auditors are afraid to work with cryptocurrencies, and some do not know the specifics of cryptocurrency exchanges.
With New Year's growth, buyers did not ask. Zhao tried to level the bearish sentiment and stop the massive withdrawal of funds and sales, but investors continue to sell cryptocurrency. Since the sellers broke through the trend line, the risks of falling to $15,500 increased sharply. Only this time the support is unlikely to hold. A new drain of American stocks in the week from December 19 to 25 and low activity of buyers can help sellers collapse Bitcoin to the $10,000 - $12,000 zone.
Over the weekend, the BTC/USDt pair traded in a narrow range at $16,718. Further movement depends on the opening of the market for index futures. In order for the price pattern on the daily time frame to become bullish again, the price must return to the level of 18 thousand in two days (for Monday and Tuesday). First you need to pass $17,100 in one day. This will allow buyers to regroup and prepare for a recovery to 18k. I don't know what factors could change market sentiment. Next week, from December 19 to 25, the news background is poor. Liquidity in the markets will decrease before the Christmas holidays. Crypto can fly on horror stories about the Binance exchange from 5% to 15%. According to the cumulative delta, there are more sales than purchases.