{"id":11371,"date":"2022-06-06T08:53:43","date_gmt":"2022-06-06T08:53:43","guid":{"rendered":"https:\/\/nftandcrypto-news.com\/crypto\/btc-price-snaps-its-longest-losing-streak-in-history-5-things-to-know-in-bitcoin-this-week\/"},"modified":"2022-06-06T08:53:46","modified_gmt":"2022-06-06T08:53:46","slug":"btc-price-snaps-its-longest-losing-streak-in-history-5-things-to-know-in-bitcoin-this-week","status":"publish","type":"post","link":"https:\/\/nftandcrypto-news.com\/crypto\/btc-price-snaps-its-longest-losing-streak-in-history-5-things-to-know-in-bitcoin-this-week\/","title":{"rendered":"BTC price snaps its longest losing streak in history \u2014 5 things to know in Bitcoin this week"},"content":{"rendered":"
\n

Bitcoin (BTC) starts a new week with some fresh hope for hodlers after halting what has been the longest weekly downtrend in its history.<\/p>\n

After battling for support throughout the weekend, BTC\/USD ultimately found its footing to close out the week at $29,900 \u2014 $450 higher than last Sunday.<\/p>\n

The bullish momentum did not stop there, with the pair climbing through the night into June 6 to reach multi-day highs.<\/p>\n

The price action provides some long-awaited relief to bulls, but Bitcoin is far from out of the woods at the start of what promises to be an interesting trading week. <\/p>\n

The culmination will likely be United States inflation data, this itself a yardstick for the macroeconomic forces at world globally. As time goes on, the impact of anti-COVID policies, geopolitical tensions and supply shortages is becoming all the more apparent.<\/p>\n

Risk assets remain an unlikely bet for many, as central bank monetary tightening is seen to be apt to pressure stocks and crypto alike going forward.<\/p>\n

Bitcoin\u2019s network fundamentals, meanwhile, continue to adapt to the surrounding reality and its impact on network participants.<\/p>\n

Cointelegraph takes a look at five factors to bear in mind when charting where BTC price action may be headed in the coming days.<\/p>\n

Tenth time’s the charm for BTC weekly<\/h2>\n

It was a long time coming, but Bitcoin has finally closed out a \u201cgreen\u201d week on the weekly chart. <\/p>\n

BTC\/USD had spent a record nine weeks making progressively lower weekly closes \u2014 a trend which began in late March and ended up being the longest ever in its history. <\/p>\n

On June 5, however, bears had no chance, pushing the pair to $29,900 before the new week began, this still being approximately $450 higher than the previous week\u2019s closing price. <\/p>\n

That event sparked several hours of upside, with local highs totaling $31,327 on Bitstamp at the time of writing \u2014 Bitcoin\u2019s best performance since June 1.<\/p>\n

\n

On the Weekly candle close, Trend Precognition printed a Long signal on the #Bitcoin<\/a> Weekly chart. Looking for a HH on the Weekly to confirm a breakout. If #BTC<\/a> rallies, key MA’s should act as technical resistance. https:\/\/t.co\/NPVL3D27C5 pic.twitter.com\/GxwT5zI3gC<\/a><\/p>\n

\u2014 Material Indicators (@MI_Algos) June 6, 2022<\/a><\/p><\/blockquote>\n

While some celebrated<\/a> Bitcoin\u2019s newfound strength, others remained firmly cool on the prospects of a more substantial rally. <\/p>\n

Cointelegraph contributor Micha\u00ebl van de Poppe eyed the open CME futures gap from the weekend, this providing a lure for a return to $29,000.<\/p>\n

\u201cStill expecting this to be happening on Bitcoin,\u201d he told Twitter followers. <\/p>\n

\u201cA drop towards the CME Gap at $29K would make a lot of sense before a short reversal towards $31.5K.\u201d<\/p><\/blockquote>\n

A look at order book data reinforces the friction bulls are likely to face in the event of a continued breakout. At the time of writing, the area around $32,000 had more than $60 million in sell-side liquidity lined up on Binance alone.<\/p>\n

BTC\/USD order book data chart (Binance). Source: Material Indicators<\/em><\/figcaption><\/figure>\n

For Il Capo of Crypto, a Twitter analytics account well known for its sobering takes on upcoming BTC price action, there was likewise little to feel confident about.<\/p>\n

\n

In addition to this:<\/p>\n

-Price is basically ranging between 29k-31k. That’s below the main pivot (S\/R flip)<\/p>\n

-Every move up is corrective and data shows that bulls are being trapped.<\/p>\n

We might see a scam pump to $30.7k-31.5k, but the bearish main targets are still very likely. https:\/\/t.co\/UnmENNNK6z<\/p>\n

\u2014 il Capo Of Crypto (@CryptoCapo_) June 5, 2022<\/a><\/p><\/blockquote>\n

Nonetheless, the market was not without its optimism.<\/p>\n

\u201cHaving a plan is more important than guessing the correct direction,\u201d popular Twitter account IncomeSharks argued<\/a>. <\/p>\n

\u201cI think we drop then go up, so I’ll be longing if this happens. If stocks open up green we could rally and I’ll pivot to alts to ride them up. TP level is at $34,000 for now.\u201d<\/p><\/blockquote>\n

Countdown to U.S. CPI reado<\/h2>\n

U.S. inflation is at its highest since the early 1980s, but will it continue?<\/p>\n

The market will find out this week as June 10 sees the release of Consumer Price Index (CPI) data for May. <\/p>\n

One of the benchmarks for gauging how inflation is progressing, CPI prints have traditionally been accompanied by market volatility both within crypto and beyond.<\/p>\n

The question for many is how much higher it can go as the aftermath of the Russia-Ukraine conflict and its impact on global trade and supply chains continues to play out. <\/p>\n

In the U.S., the Federal Reserve\u2019s interest rate hikes are also under scrutiny as a result of prices surging.<\/p>\n

The end of the \u201ceasy money\u201d era is a difficult one for stocks and correlated crypto assets more generally, and that pain trend is expected not to end any time soon, regardless of inflation performance.<\/p>\n

\u201cLiquidity is going out of the market and what that means is it will have an impact on the equity markets,\u201d Charu Chanana, market strategist at Saxo Capital Markets, told Bloomberg. <\/p>\n

\u201cWe do expect that the drawdown in the equity markets still has some room to go.\u201d<\/p><\/blockquote>\n

Chanana was speaking as Asian markets rallied in early week’s trading, led by China loosening its latest round of COVID-19 lockdown measures.<\/p>\n

The Shanghai Composite Index was up 1.1% at the time of writing, while Hong Kong\u2019s Hang Seng traded up more than 1.5%.<\/p>\n

Beyond the intraday data, however, the mood when it comes to macro versus crypto is very much one of cold feet.<\/p>\n

For trading firm QCP Capital, the latest contraction in U.S. M2 money supply \u2014 only its third in around twenty years \u2014 is another reason to not take any chances.<\/p>\n

\u201cThis contraction in M2 has been a result of Fed hikes and forward guidance which drove a surge in reverse repos (RRP) to all-time record levels. Banks and money market funds withdrew money from the financial system in order to park it with the Fed to take advantage of high overnight interest rates,\u201d it wrote in the latest edition of its Crypto Circular research series.<\/p>\n

\u201cThis draining of liquidity will only be exacerbated by the upcoming QT balance sheet unwind as well, beginning 1 June. We expect these factors to weigh on crypto prices.\u201d<\/p><\/blockquote>\n

U.S. inflation data chart. Source: St. Louis Fed<\/em><\/figcaption><\/figure>\n

Miner capitulation “very close”<\/h2>\n

Despite weeks of lower prices endangering their cost basis, Bitcoin miners have so far held off from significant distribution of coins.<\/p>\n

This may soon change, new analysis argues, sparking what has historically accompanied generational BTC price bottoms.<\/p>\n

In a tweet<\/a> on June 6, Charles Edwards, founder of crypto asset manager Capriole, highlighted a classic bottom signal in Bitcoin\u2019s hash ribbons metric. <\/p>\n

Hash ribbons measures miner profitability and has been historically accurate in correlating with price phases. Currently, the \u201ccapitulation\u201d phase similar to March 2020 is underway, he explained, but hodlers should do anything but sell as a result.<\/p>\n

\u201cHash Ribbon miner capitulation is very close. Bitcoin mining profit margins are getting squeezed,\u201d Edwards commented. <\/p>\n

\u201cReminder: this is not a sell signal. The end of a capitulation period has historically set up some of the best long-term buys for Bitcoin.\u201d<\/p><\/blockquote>\n

Bitcoin hash ribbons chart. Source: Charles Edwards\/ Twitter<\/em><\/figcaption><\/figure>\n

Previously, Cointelegraph reported on miners\u2019 ongoing challenges, which now includes a\u00a0ban the practice by the State of New York this month.<\/p>\n

Fundamentals echo miner calm<\/h2>\n

Fluctuations in miner participation will have a palpable effect on Bitcoin\u2019s hash rate and network difficulty. <\/p>\n

So far, hash rate has remained stable above 200 exahashes per second (EH\/s), according to estimates, indicating that miners for the most part remain active and have not decreased activity over cost concerns.<\/p>\n

Data covering Bitcoin\u2019s network difficulty likewise presents a calm short-term picture. <\/p>\n

At its upcoming automated readjustment this week, difficulty will decrease by less than 1%, again reflecting a relative lack of upheaval in the mining sphere.<\/p>\n

By contrast, the previous readjustment two weeks ago saw a 4.3% reduction, marking the biggest reversal since July 2021.<\/p>\n

Bitcoin hash rate, difficulty estimates chart. Source: BTC.com<\/em><\/figcaption><\/figure>\n

Beyond the short term, a sense of optimism prevails among some of Bitcoin\u2019s best-known commentators.<\/p>\n

\u201cAs we see in the growth of its hash rate, today bitcoin is roughly 50% cheaper yet 20% stronger than a year ago,\u201d podcast host Robert Breedlove noted<\/a> in part of a Twitter debate on June 5, arguing that this showed \u201cmobilization\u201d of entrepreneurs interested in fueling Bitcoin\u2019s growth.<\/p>\n

Megawhales show “promising sign”<\/h2>\n

In terms of putting their money where their mouth is, Bitcoin\u2019s biggest investors could be showing the way this month.<\/p>\n

Related:\u00a0Top 5 cryptocurrencies to watch this week: BTC, ADA, XLM, XMR, MANA<\/em><\/strong><\/p>\n

As noted by sentiment monitoring firm Santiment, entities controlling 1,000 BTC or more now own more of the BTC supply than at any point in the past year. <\/p>\n

\u201cThe mega whale addresses of Bitcoin, comprised partially of exchange addresses, own their highest supply of $BTC in a year,\u201d Santiment summarized<\/a> on June 6. <\/p>\n

\u201cWe often analyze the 100 to 10k $BTC addresses for alpha, but accumulation from this high tier can still be a promising sign.\u201d<\/p><\/blockquote>\n

Bitcoin megawhale accumulation trends chart. Source: Santiment\/ Twitter<\/em><\/figcaption><\/figure>\n

Data from on-chain analytics firm CryptoQuant meanwhile allays fears that users are sending BTC en masse to exchanges for sale. The overall trend in decreasing exchange reserves continues, and is at levels last seen in October 2018.<\/p>\n

Bitcoin exchange reserves vs. BTC\/USD chart. Source: CryptoQuant<\/em><\/figcaption><\/figure>\n

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.\n<\/p>\n<\/div>\n