Bitcoin has started a new week on familiar territory: vital support is back, but the bulls have yet to break out. Could that change anytime soon?

After beating back the USD 33,000 mark on Friday, BTC / USD is maintaining the trading corridor it had before last week’s rapid volatility. This move pushed the price down to $ 32,000 due to the sudden accumulation of short positions on the Bitfinex exchange.

However, the effects were temporary, with a high of $ 34,600 over the weekend.

Source: TradingView

The article is going to point out 5 factors to consider in determining what Bitcoin will do next.

Stocks explode when the USD encounters classic resistance

With stocks bouncing back as usual, there seems to be little conflict that could pose a problem for crypto profits.

While analysts are warning of a possible pullback, sentiment in the stock market has remained stable this week.

Simon Ballard, Chief Economist at First Abu Dhabi Bank, said:

“It seems that Goldilocks (the economy is neither growing too fast nor too slow) not only lives well, but is getting stronger every day. Unfortunately, one has to acknowledge that the longer interest rates stay there, the more likely it is that we will tighten monetary policy, the more violent and sharper the reaction. “

However, the US dollar can give us further clues.

Looking at the US dollar currency index (DXY – an index that measures the strength of the USD against 20 trading partner currencies), the graph shows that some known resistance levels are back in action.

Late last week, an analyst argued that DXY would need to rise from current 92.2 levels to around 94 to face major resistance and kickstart Bitcoin.

However, on Monday, DXY is still recovering from the weekend’s losses and is also battling an area that has gripped it in the past.

Bitcoin’s negative correlation with DXY has also been closely monitored recently, as BTC is increasingly going its own way in the macro environment.

1-day candlestick chart of the US Dollar Currency Index (DXY) | Source: TradingView

Bitcoin price is still on the right track

Looking at the spot market, traders are bullish if they expect a return to the $ 33,000 mark and a long hold after a brief pullback last week.

After “confirming” this level, the trader and analyst has Rekt Capital to explain on Sunday that BTC / USD returned to the bottom of a set range.

“BTC is breaking back above the orange trend line. BTC is doing everything right to reclaim this trend line as support. If successful, it will be a big step towards mastering the challenge of breaking out of this blue wedge structure. “

script BTC / USD on December 7th | Source: Rekt Capital

Fortunately, Monday is still trending with Bitcoin trading at around $ 33,507 at press time.

“Bitcoin is trying to bounce back and close above $ 34,000 with a long down wick for the 8th straight week. The demand is still great, ”says trader Scott Melker Say more.

Last week, the targets for Bitcoin rose to $ 39,000 as the bulls attempt to attack the $ 35,500 resistance and continue to rise, but this is not currently happening.

Basic elements

If last week’s price action disappoints, it is clear that Bitcoin has taken a more significant step.

Data Monitoring sources on Monday show that both network difficulties and hashrate are stabilizing. That could mean the worst of the recent mine crisis is over.

After a record drop in early July, the difficulty level even surpassed the latest feat and is expected to drop another 28%.

However, the recovery has already begun. Therefore, the next difficulty correction will only decrease by 10% if the price movement stays near the current level.

Yesterday angel investor Klaus Lovgreen Summary:

“Blocks go through a steep phase – the subsequent difficulty adjustment is currently estimated at ~ -7.5%. But to me it looks like the hashrate is recovering pretty quickly at the moment. “

Network Difficulty Table Bitcoin | Source: Blockchain

The above changes testify to the power of the Bitcoin network to balance itself out without outside assistance. However, the difficulty will adjust and take into account any given situation.

The estimated hashrate currently remains modestly above the recent low of 83 exahashes per second (EH / s), but there is still stability and the possibility of a return, albeit slowly.

Both indices are expected to take a new step after the mining power returns to Bitcoin. However, no one could determine the exact time frame for this.

Grayscale unlocks 40,000 BTC

One event that’s on everyone’s radar this month is the grayscale giant’s multiple BTC unlocks.

Grayscale Bitcoin Fund (GBTC) will be issuing over 40,000 BTC in the coming weeks after a six-month lock-up period.

There are mixed opinions about the market impact of this event. Some fear that selling pressure will increase (although it will then go back to zero once released), while others think the cash market will not be badly affected.

July 18 is of particular interest as the value unlocked that day was more than 16,000 BTC.

Statistician Willy Woo comment last week:

“When GBTC shares are unlocked and sold, the GBTC spread will decrease (the share price will decrease relative to BTC in the trust). Investors now have more incentives for GBTC stocks than for BTC, which eases buying pressure on the BTC spot market somewhat. That is a bearish sign. “

GBTC Unlock Plan Chart | Source: Bybt

Price index rises near the “start zone”

Looking for reliable signs of optimism for the week ahead? Bitcoin market analysis gives you the answer.

On Monday, attention turned to an indicator from on-chain data company CryptoQuant. This indicator captures every major BTC price movement over the past 2 years.

The Taker Buy Sell Volume / Ratio tracks stock market data to provide guidance on when to HODL and when to have a good profit-taking opportunity in a local market cycle.

At the moment, the indicator seems to be pointing to another BTC / USD rally, towards the classic take profit point.

Analyst Cole Garner even emphasize What if history repeats itself. He noted, however, that the trigger phase – in which the odds hit the highest level of the blue channel – “has not yet occurred”.

“Buy signal is coming”.

Bitcoin Taker Buy Sell Volume / Ratio Indicator | Source: Cole Garner

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