Bitcoin price is moving lower below the $27,200 support. BTC could decline further if the Israel-Hamas war escalates in the near term.

• Bitcoin is moving lower and showing bearish signs below $27,500.
• The price is trading below $27,500 and the 100 hourly Simple moving average.
• There is a key bearish trend line forming with resistance near $27,550 on the hourly chart of the BTC/USD pair (data feed from Kraken).
• The pair could accelerate lower below the $27,000 support in the near term.

Bitcoin Price Starts Descend

Bitcoin price failed to gain pace above the $27,800 resistance. BTC reacted to the downside amid rising Israel-Hamas tensions. There were more than 1200 deaths reported already by Israel.

The price is moving lower below the $27,500 pivot level. There was also a downside break below the 76.4% Fib retracement level of the upward move from the $27,185 swing low to the $28,284 high. More importantly, the price traded below the key $27,200 support zone.

Bitcoin is now trading below $27,500 and the 100 hourly Simple moving average. There is also a key bearish trend line forming with resistance near $27,550 on the hourly chart of the BTC/USD pair.

If there is an upside correction, the price might face resistance near the $27,400 level. The next key resistance could be near the $27,500 level and the trend line. The first major resistance is $27,800, above which Bitcoin might test $28,250.

Source: BTCUSD on TradingView.com

The main downtrend resistance could be $28,500. A close above the $28,500 resistance could start another increase. In the stated case, the price could rise toward the $30,000 resistance.

More Losses In BTC?

If Bitcoin fails to recover higher above the $27,500 resistance, there could be more losses. Immediate support on the downside is near the $27,000 level or the 1.236 Fib extension level of the upward move from the $27,185 swing low to the $28,284 high.

The next major support is near the $26,500 level. A downside break and close below the $26,500 support might send the price further lower. The next support sits at $26,000.

Technical indicators:

Hourly MACD – The MACD is now gaining pace in the bearish zone.

Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now below the 50 level.

Major Support Levels – $27,000, followed by $26,500.

Major Resistance Levels – $27,400, $27,500, and $28,500.

Key Takeaways

• Our Head of Research, Dan Ashmore, digs into Bitcoin’s relationship with stocks
• Correlation between Bitcoin and the Nasdaq is at its lowest point since 2018
• The Nasdaq is up 10% in the last month as stocks have surged off softer forecasts around interest rates and the macro climate
• Bitcoin is down 9% in the same time frame, the US regulatory crackdown spreading fear about crypto’s future in the country 
• Ashmore writes that the break in correlation surpasses what was seen in November 2022 amid the FTX collapse, when Bitcoin fell to $15,000 while stocks increased off positive inflation readings

After ten consecutive interest rate hikes, the US Federal Reserve this week paused its rate hiking policy. The move was nearly unanimously anticipated by the market and movement after the meeting was relatively minimal.  

However, over the past month, markets have been flying. The S&P 500 is up 6% in the last 30 days, now only 8.8% off an all-time high, despite being 27% below the mark in October. The Nasdaq is up 10% over the same timeframe – that is 15% below its all-time high from November 2021 but a tremendous resurgence considering it shed a third of its value in 2022.  

And yet, something is being left behind: Bitcoin. 

Bitcoin is now trading below $25,000 for the first time in three months. I put together a deep dive in March analysing the its underlying price movement to show how tightly it trades with the stock market. This was at a time when Bitcoin was rallying and banks were wobbling amid the Silicon Valley Bank fiasco. Suddenly, it was fashionable to declare Bitcoin as decoupling from the stock market. Ultimately, that wasn’t true. However, something very interesting has happened in the last month. 

First, take a look at the path of the Nasdaq and Bitcoin since the start of 2022, which roughly coincides with the start of the bear market: 

Clearly, the two have moved in lockstep. But two episodes jump out: the first is November 2022, when Bitcoin fell and the Nasdaq surged. The second is this past month. We discussed the 10% jump in the Nasdaq over the last month. However, Bitcoin has fallen 9% in the same timeframe. This marks a clear departure from what we would expect. Plotting the correlation (using 60-Day Pearson) shows this more directly:

I touched on November 2022 above, and the swift fall in correlation can be seen on the chart. This was when FTX collapsed, sending the crypto market into a tailspin. At the same time, however, stocks raced upwards as softer inflation numbers were met by lower expectations around the future path of interest rates. 

There were also less dramatic (but equally temporary) decouplings between Bitcoin and stocks in April/May 2022 and June/July 2022. On the chart below, I have pencilled in incidents which occurred during these periods:

Indeed, what is different about November (FTX) and today is that we see a Bitcoin fall happening at the same time as a Nasdaq surge. While the Luna and Celsius incidents hurt crypto immensely, they came as stocks were also struggling and so the effect is not as dramatic in terms of correlation breaks (although is still tangible on the chart).

But today, we are seeing the biggest break in the correlation trend over the last couple of years – surpassing even FTX. The 60-Day Pearson currently sits at -0.66, whereas the lowest it hit during the FTX crisis was -0.49. 

Regulatory crackdown is suppressing prices

The reason is obvious. The great regulatory crackdown in the US is freaking the market out, and for very good reason. The two biggest crypto companies on the planet, Binance and Coinbase, were both sued last week. 

Crypto.com has suspended its institutional exchange, citing weak demand amid the regulatory woes. eToro and Robinhood pulled a bunch of tokens from their platforms following confirmation from the SEC that it viewed them as securities. Liquidity is dropping like a stone. 

I wrote in-depth about the concern following the announcement of the Coinbase lawsuit last week, so I won’t rehash it here (that analysis is here). While I believe Bitcoin should be able to weather the storm long-term, the picture appears far murkier for other cryptocurrencies. 

Make no mistake about it, the crypto industry faces a massive problem as long as lawmakers continue to turn the screw. The crisis very much feels existential for a lot of the crypto market. 

Regarding Bitcoin, enthusiasts dream of a day when it can decouple and claim that title of uncorrelated hedge asset, or a store-of-value, akin to gold. I’ve done a lot of work around what that hypothetical future could look like, or what could lead the market to that point. But for now this remains just that: hypothetical.  Because while the correlation is at its lowest point in five years, it is not being driven by fundamentals and thus will inevitably spike back up. This is nothing more than the market reacting to what is a very bearish development around regulation in the US. 

It’s not how investors hoped a decoupling would come. But if anyone doubted the market’s fear over the regulatory woes, or questioned why Bitcoin had not fallen more, looking at the break in correlation paints a very clear picture of how detrimental Gary Gensler’s games have been to the cryptocurrency industry. 

In truth, it is not hyperbole to say that this is the most out of whack Bitcoin’s correlation has ever been whilst trading as a mainstream financial asset. Because back when it last happened in 2018, Bitcoin traded with such thin liquidity that its price action is largely irrelevant to draw conclusions from going forward. 

Dogecoin DOGE/USD traded 4.7% lower at $0.6 over 24 hours leading up to Friday morning.

DOGE fell in tandem with other major coins as the global cryptocurrency market cap declined 4.8% to $898 billion.

Dogecoin Price Performance

Time-frame	% Change (+/-)
24-hour	-4.7%
24-hour against Bitcoin	1.1%
24-hour against Ethereum	-4.5%
7-day	-28.7
30-day	-36.6%
YTD performance	-67.2%

See Also: Best Crypto Debit Cards

The DOGE Factors 

• DOGE was among the most mentioned cryptocurrencies on Twitter, according to Cointrendz data. Bitcoin, Ethereum, and Cardano were the three most mentioned coins at press time
• The 24-hour DOGE trading volume fell 30.6% to $679.89 million, according to CoinMarketCap.
• Coinglass data indicated that $1.4 million worth of DOGE were liquidated over 24 hours as the price of the meme cryptocurrency fell.
• DOGE’s relative strength index was at 30.836 at press time. An RSI of below 30 indicates oversold conditions.

Recession Fears Grip Crypto

“Surging recession fears are crippling appetite for risky assets and that has crypto traders remaining cautious about buying Bitcoin at these lows,” said Edward Moya, a senior market analyst at OANDA on Wednesday. Weak U.S. economic data and rate hikes by major central banks on Thursday added to the negative news cycle.

Lawsuit Against DOGE-Bull Musk

Tesla Inc TSLA and SpaceX CEO Elon Musk is being sued for $258 billion over claims that he was involved in a pyramid scheme that inflated the meme coin’s price and left investors with losses amounting to billions of dollars.

Learnings From Crypto Winter

Dogecoin co-creator Billy Markus tweeted Thursday that if there is a new bull run after crypto winter could we all “collectively learn from the failings of celsius, luna, and 3ac.” 

assuming we have a new bull run after this crypto winter, could we all collectively learn from the failings of celsius, luna, and 3ac, and y’know, actually listen to people when they call out systemic risks instead of bullying people into silence because it helps short term bags

— Shibetoshi Nakamoto (@BillyM2k) June 16, 2022

DOGE On The Web

Dogecoin millionaire Glauber Contessoto said dollar-cost averaging the “safest way to buy into crypto” in a tweet on Thursday. 

Honestly the safest way to buy in to crypto is to DCA every month – my BFF @andreijikh told me this lol. I might start doing things the safe way this time around lol

— SlumDOGE Millionaire (@ProTheDoge) June 16, 2022

Dollar-cost averaging is a strategy in which investors buy a fixed dollar amount on a regular basis instead of making a lump-sum investment. It is propounded as a means of risk minimization. 

Read Next: Elon Musk Wants To Be ‘Let In’ Somewhere This Halloween, Disguised As A ‘Sink’

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Dogecoin (CRYPTO: DOGE) traded 1.46% lower at $0.245 over 24 hours early Wednesday.
What’s Moving? The Shiba Inu-themed cryptocurrency has appreciated 9.39% over a seven-day period.

DOGE traded 3.7% and 2.16% lower against Bitcoin and Ethereum respectively over 24 hours.

Since the year began, DOGE has gained 4212.65%. In May, the meme coin hit an all-time high of $0.74.

See Also: How To Buy Dogecoin (DOGE)

Why Is It Moving? DOGE did not move alongside other major coins as the global cryptocurrency market capitalization rose 1.6% to $2.53 trillion at press time. 

DOGE trading volumes dipped 75.4% to $1.29 billion over a 24 hour period.

The meme coin did not see high interest on Twitter at press time. DOGE was mentioned in 1,537 tweets, as per Cointrendz data.

At press time, Bitcoin and Solana were the two top trending coins on Twitter and were mentioned in 13,348 and 7,049 tweets, respectively. 

On Tuesday, Bitcoin hovered near its all-time high of $64,863.10 but failed to breach it. The exuberance was fueled by the launch of the first BTC exchange-traded fund ProShares Bitcoin Strategy ETF (NYSE:BITO). 

As the apex coin targets new highs, the possibility of profit-taking by long-term holders remains intact, as per CryptoQuant.

Even so, some analysts remained upbeat about DOGE. Justin Bennet, a cryptocurrency market analyst, said this week that DOGE is consolidating and if the coin was able to reclaim the $0.24 level it could see a multi-month price surge. 

Read Next: Has Shiba Inu Price Hit A Wall Of Resistance? Why Investments In Dogecoin Killer Are Slumping Today

CNBC “Mad Money” host Jim Cramer said Monday investors like him should book profits in their cryptocurrency portfolios before things get worse due to the weakness related to struggling Chinese property developer Evergrande.

What Happened: Cramer said, as much as cryptocurrency backers don’t like to hear the word “sell,” he was “begging” investors who have made gains in cryptocurrencies to sell some of their holdings and return to weigh in as the situation unfolds.

“Don’t let it become a loss. Sell some, stay long the rest, then let’s wait and see if China changes its attitude toward an Evergrande bailout,” Cramer said on his show.

Cramer, who has disclosed a position in Ethereum (CRYPTO: ETH), said his concerns begin with Tether (CRYPTO: USDT), a stablecoin that’s pegged to the U.S. dollar. 

See Also: Why Bitcoin And Ethereum Are Trading Lower Today

Tether is the third-largest cryptocurrency by market value, trailing only Bitcoin (CRYPTO: BTC) and Etherereum.

“The problem with tether is that it’s backed by various holdings and roughly half of those are commercial paper — short-term loans — and much of that is believed to be, but we don’t know, Chinese commercial paper,” Cramer said, adding that even if Tether doesn’t any Evergrande exposure, as it claims, “tonnes” of Chinese businesses could get crushed due to the Evergrande exposure and that could trigger a fall of dominoes.

Why It Matters:

Cramer said it’s not just the Tether investors that are at risk but a fall in such a scenario is “going to gut the whole crypto ecosystem.” The former hedge fund manager said “if you own crypto in any form,” book some profits, implying such a fall would impact major cryptocurrencies like Bitcoin, Ethereum, Dogecoin and possibly even crypto-play stocks.

Bitcoin and Ethereum are trading significantly lower amid a broader market sell-off triggered by increasing concerns that Chinese property giant Evergrande’s current debt could lead to a collapse. Evergrande is a major property developer in China and also owns multiple other business units operating in industries such as healthcare services and electric vehicles. The company has more than $300 billion in total liabilities and recently warned investors it may default on its debts.

Price Action: BTC was trading 1.31% lower at $43,111.67 as of press time on Tuesday. ETH was up 1.2% at $3,041.75. Dogecoin (CRYPTO: DOGE) was trading 2.79% lower at $0.21. 

For news coverage in French, Italian, or Spanish, check out Benzinga France, Benzinga Italia, or Benzinga España.

Photo by Tulane Public Relations on Wikimedia