Bitcoin Price Prediction
The BTC/USD closed at $60089.1 after setting a high of $63605.6 and a low of $58655.9. The BTC/USD extended its loss on Tuesday and dropped to its 20-day lowest level amid the cryptocurrency market's recent negative developments. On Tuesday, Bitcoin fell below $60,000 for the first time since Nov. 1st, after the US infrastructure bill was passed and China hardened its stance on cryptocurrency mining.
On Monday, U.S. President Joe Biden signed the US infrastructure bill, including new rules for the cryptocurrency industry. According to the law, brokers will be required to report much more than they are currently reporting.
The law requires that digital asset transactions worth more than $10,000 be reported to the Internal Revenue Service (IRS). The transaction recipient will need to verify the sender's personal information within 15 days of the transaction. These new reporting requirements will take effect in 2024. Moreover, this news reinforced negative perceptions of the cryptocurrency market by imposing regulations on the market, which ultimately contributed to the loss in BTC/USD.
On Tuesday, the further decline in BTC/USD was driven by the latest crackdown on cryptocurrency mining in China. The National Development and Reform Commission unveiled its plans to further crackdown on industrial-scale bitcoin mining and involvement by state companies.
China also announced that it would consider punitive measures like higher power prices on companies that flout the rules. It was not the first time China has attempted to rein in the cryptocurrency industry. In June this year, China issued a notice to banks and other financial institutions to stop facilitating transactions and banned mining of currencies. In September, China banned all other cryptocurrency transactions and called them illegal. The latest crackdown on cryptocurrency mining from China added fresh downward pressure on BTC/USD, which was already declining amid the approval of an infrastructure law in the US.
On the other hand, another factor involved in the declining prices of BTC/USD was the renewed strength of the US dollar. The US dollar was strong across the market, which ultimately weighed on the leading cryptocurrency as both have a negative correlation. The DXY, which measures the greenback value against the basket of six major currencies, surged and reached the 95.90 level, which added further strength to the US dollar as macroeconomic data released on the day was also in favor of the local currency.
BTC/USD Intraday Technical Levels
Pivot Point: 60798.0
BTC/USD - Technical Outlook
The leading cryptocurrency pair, BTC/USD, is trading with a bearish bias at the 59,600 level. The double bottom support level provides solid support at the 58,000 level. However, Bitcoin has violated the intraday pivot point support level of 60,944. The closing of candles below this support zone is demonstrating a selling bias, but at the same time, the formation of Doji candles above the 58,000 support level is signalling weakness in the selling trend.
The break below the 58,000 support level exposes the bitcoin price towards 57,850, 55,609, and 52,650 levels. The bullish crossover at 60,944 exposes the BTC/USD pair to 63,320 and 66,279 levels. All the best!
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