After dipping below $90,000 again, the next direction of the Bitcoin price is once again hotly debated. This comes with the added burden of a number of major events happening this week, as well as investor sentiment remaining in negative territory for an extended period of time. Crypto analyst MarcPMarkets shares his thoughts on the current state of the market and what investors should pay attention to as its next direction is determined.
The bearish and bullish scenarios
In the analysis shared on the TradingView website, MarcPMarkets highlights the different scenarios that could determine where the Bitcoin price could go next. He warns investors to watch for confirmation. The first level the analyst highlights is the $93,500 area, where Bitcoin price has failed to reach a high.
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Since the price fell below $90,000 this weekend, the next major level is now at $88,000, and this is where the bulls need to protect their support. In the event that the bulls lose this support and the price breaks decisively below this point, the crypto analyst warns investors to expect the Bitcoin price to fall another $10,000. Next would be the $78,000 area, where the cryptocurrency is likely to secure its next support.
On the other hand, where the Bitcoin price could turn bullish again, the crypto analyst points to the resistance at $95,000. Investors should pay attention to this resistance because if it is broken, it would mean strength is building back up, completely negating the bearish scenario mentioned above.
The main objectives in the case of a bullish takeover would initially be $105,581. Above this lies the next major level at $113,213, and finally the $120,850 target which would be the last hit before momentum fades.
Developments that could influence the Bitcoin price
In addition to the price action, some events are expected to occur this week that could influence Bitcoin’s trajectory. The FOMC meeting is getting closer and the Fed is expected to announce its position on the financial markets in the future.
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If the Fed adopts a dovish stance at the end of the press conference, the crypto analyst expects prices to rise again. Furthermore, quantitative tightening ended in early December, pushing markets into an era of quantitative easing, which has always been positive for risk assets as new liquidity is pumped into the market.
Featured image of Dall.E, chart from TradingView.com