Bitcoin continues to see a lot of headwinds at the moment, as the risk appetite is horrible currently. Institutions are seeing massive outflows at the moment, and this continues to cause issues.
BTC/USD
The main reason at this point in time is that there is a combination of risk-off sentiment and liquidity tightening. Stronger than expected economic data coming out of the United States, such as PMI and jobs, has revived the higher for longer interest rate narrative, boosting the US dollar a bit and increasing the opportunity cost of holding non-yielding digital assets.
While longer-term holders remain in a consolidation mindset, short-term momentum is being dampened by significant ETF outflows, exceeding over $500 million recently. The cooling tech sector, with which Bitcoin remains tightly correlated, also weighs on the market.
Critical Support and Resistance Levels
There is support at the $65,000 level in a minor sense and a much bigger, important support level underneath there at $60,000. If we were to break down below the $60,000 level, it would be horrible for Bitcoin. To the upside, it looks like the $72,000 level continues to be significant resistance, and if we can break above there, it would obviously be very bullish.
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Keep in mind that we have recently seen the Nasdaq 100 struggle a bit, and that tends to move somewhat in tandem with Bitcoin. Really, I think at this point, it suggests that perhaps we will have to see technology companies turn around and make a move in order to get people buying Bitcoin again. It is an institutional asset now, so that does have a different risk profile and recovery profile unlike in the past when retail traders would come in and just gobble it up. Because of this, I suspect that we have a little bit of noisy and choppy behavior, but if we can stay above the $60,000 level, it could be the beginning of a bottoming process.
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