Last week saw one of the largest losses of value in the history of cryptocurrency. Bitcoin and the general crypto market crisis was hit by the Terra ecosystem’s collapse. Bitcoin plummeted to under $30,000. Obviously, institutional players took advantage of the circumstance.
Investors Flood Bitcoin
Institutions reportedly invested $300 Million into exchange-traded Bitcoin funds last week, according to reports. According to CoinShares, the previous week recorded record weekly crypto inflows for the year 2022. The net weekly inflows were $274 million in the previous week.
While North American investors pumped $312 million into cryptocurrency last week, European investors saw a $38 million net outflow. According to the CoinShares report:
Investors saw the recent UST stable coin de-peg and its associated broad sell-off as a buying opportunity. Bitcoin was the primary benefactor, with inflows totalling US$299m last week, suggesting investors were flocking to the relative safety of the largest digital asset.
CoinShares’ head of research, James Butterfill, expressed amazement at the unprecedented volume of bullish investments in Bitcoin funds despite increased market volatility. “It’s the highest weekly total since October 2021, and the 19th highest since records began in 2015,” he said.
Bitcoin’s price peaked at $69,000 in November of last year, and it has since been on a steady decline, losing more than 50% of its value. The Bitcoin price has dropped by more than 20% since the beginning of May 2022.
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Would Price Surge?
Bitcoin plummeted against the US dollar and hit the $29,000 support level. BTC must settle above the $30,500 resistance to begin a solid rise. Bitcoin dipped below $30,000 after failing to gain traction above $31,000.
The price is currently trading above both the $30,000 and the 100 hourly simple moving averages. A break over a connecting negative trend line with resistance near $29,600 was seen on the hourly chart of the BTC/USD pair. The pair could acquire bullish momentum if it closes above the $30,500 resistance.
Although the price dipped below $29,500, bulls were active near $29,000. The price has recovered losses after forming a low near $29,060. Above the $29,500 barrier, there was a clear upward movement. The price surpassed the 23.6 percent Fib retracement level of the latest drop from the swing high of $31,390 to the low of $29,060.
There is immediate resistance near the $30,300 mark. It’s approaching the 50% Fib retracement level of the latest drop from the swing high of $31,390 to the low of $29,060. A solid close above $30,300 might pave the path for a large gain.
BTC/USD trades slightly above $30k. Source: TradingView
Around $31,400 is the next major resistance level. In the next sessions, a clear break over the $30,300 and $31,400 resistance levels could kick-start a new upswing. Near $32,500 could be the next big resistance level, after which the price could rise to $34,000.
If bitcoin fails to break past the $31,400 barrier mark, it could fall further. On the downside, $29,600 provides immediate support.
Around $29,000 is the first substantial support. If the price breaks and closes below the $29,000 support level, it might herald the start of a significant fall.
Related reading | TA: Bitcoin Holds Key Support, Why BTC Must Clear This Resistance
Featured image from iStockPhoto, Charts from TradingView.com