Hi traders!

I suppose we may see a new dip (or a widening of a recent consolidation) before the new bullish rally starts. Here’s my foundation for that:

1. On-chain analysis perspective.

While we observe that BTC is being accumulated by strong hands (according to different metrics), it’s visible that the price and position of long-term “hodlers” have a negative correlation. We observe the HODL wave indicator moving up, and it is more likely to proceed to move higher. Guess what happens with the price of BTCUSD during that process? It would probably continue moving down. The trend would change, but it’s difficult to say when exactly.

https://drive.google.com/file/d/1o02C31F69XqarPBEGKJ-wbqRrndZXtHV/view

2. The risk-off regime in traditional markets (yes, it may affect Bitcoin too)

BTCUSD has some correlation with the Nasdaq index, representing the dynamics of tech stocks. Probably, that is happening because of the increasing adoption of BTCUSD in the institutional industry. The logic is straightforward: when uncertainty and volatility increase (which we have now, for example), hedge-funds tend to cut the share of cyclical stocks and alternative investments in their portfolios (and their positions in Bitcoin and derivatives for Bitcoin ).

What do we have now? We have increasing inflation expectations and a hawkish FED. If you look at the fedwatchtool from CME , you will see that the probability of an accelerated interest rate hike becomes greater every week. The purple line indicates the rise of hawkishness of FED (as perceived by traders)

https://drive.google.com/file/d/1Cj3lJ4_6LageIdmBnW2dYhQc3fI-MQ8g/view?usp=sharing

3. Technical perspective

Yes, the old-fashioned boring technical perspective should dominate your view in the short term)
From this perspective, we don’t see any signs of significant buying activity. How do I know that? If you take a look at each price swing, it contains 2-3 consecutive bullish days, which is an indication of a “technical” action and domination of short-term traders. We’ve had a notable buying pressure recently, but it’s unclear whether it’s going to continue soon (need confirmation)

https://drive.google.com/file/d/1JQoFM9JnYxC4pKnhXIiwFATo66-Uigdy/view?usp=sharing

Bottom line:

Probably, BTCUSD is still under pressure from both fundamental and technical perspectives, that’s why I’d be very cautious with longs, at least until it breaks through $4500