Technical Analysis

BTC/USD Price Analysis – February 22, 2023

By LonghornFX Technical Analysis
Feb 22, 20233 min

Daily Price Outlook

BTC/USD is trading at $24,080, reflecting an almost 3% decrease over the past 24 hours. While the price movement of BTC is lower for the day, there is still a presence of strength in the long run.

Analysis of Crypto Fund Flows Reveals Negative Sentiment and Impact of Regulatory Actions

On February 20, Coinshares issued a blog post titled Digital Asset Coinshares released a post titled "Digital Asset Fund Flows Weekly Report" on February 20, reporting high outflows of $62 million in the middle of last week, indicating negative sentiment towards cryptocurrencies. During the bearish week, Bitcoin had the highest outflows of $24.8 million.

The crackdown on cryptocurrency enterprises by regulators in the US was a significant factor in the outflow of funds from crypto assets. The New York Financial Regulation ordered Paxos to halt minting new BUSD stablecoins, and Kraken was ordered to cease its staking program and pay a $30 million settlement fee for violating US securities law. Additionally, a potential SEC regulatory action against a stablecoin issuer added to the negative sentiment.

However, on Friday, February 17, a $30 million inflow was reported, reducing the damage caused by the outflows. Overall, crypto assets had net flows of $32 million last week, ending a six-week record of inflow.

This finding highlights how institutional investors react to regulatory actions and how such actions can impact the entire cryptocurrency market and the BTC/USD exchange rate.

US Inflation Rises and Fuels Expectations of Aggressive Fed Rate Path, Adding Selling Pressure on Bitcoin

On February 21, a report revealed that the US services PMI rose from 46.8 to 50.5 in February, exceeding the anticipated increase of 47.2. This data provides the Federal Reserve with a reason to pursue a more aggressive rate path, particularly since the services sector constitutes over two-thirds of the US economy.

Investors are expecting the Fed to continue raising interest rates for a longer period to achieve the desired level of inflation, which has caused the dollar to appreciate, with DXY currently at 104.13. Consequently, the private sector's higher-than-expected PMI data has intensified concerns about the Fed's policies.

With the focus on the Fed meeting minutes and FOMC member discussions today, BTC/USD may face additional selling pressure.

 Bitcoin Price Chart - Source: Tradingview

BTC/USD Intraday Technical Levels

Support     Resistance

24037         25022

23615         25585

23052         26007

Pivot Point: 24600

BTC/USD – Technical Outlook

On the technical front, the BTC/USD pair has breached a significant support level of $24,500, triggering a downward movement toward the $23,900 mark. The double bottom pattern has now transformed this level into a major support for BTC.

In the 2-hour timeframe, the BTC/USD pair has formed an ascending triangle pattern, with its upward trendline providing support near the $24,000 level. However, if Bitcoin falls below the $24,000 mark, its next support level will be at the $23,400 mark. The RSI and MACD indicators are both in a selling zone, adding selling pressure to Bitcoin.

On the upside, Bitcoin's immediate resistance is at $24,500, and an increase in buying pressure and a breakout above this level would expose BTC to the next resistance level at $25,200.

Today is a significant day, and the market will be closely watching the FOMC meeting minutes to determine future trends in the financial markets. The FOMC meeting minutes are due to be released today at 7:00 PM (GMT), so it is crucial to stay focused.


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