Bitcoin retested the $38k level: what awaits the asset in the new trading week?

Last week, we witnessed a rapid and substantial price movement of Bitcoin within the local range of $35.5k–$38k. Over the course of two days, the cryptocurrency could retest both the upper and lower boundaries of the fluctuation channel, indicating a high level of interest from investors and traders. As a result of Bitcoin's broad consolidation, it retested the $38.3k level.

Subsequently, the price returned within the familiar range of $35.5k–$38k, where Bitcoin spent the weekend. As of November 27th, BTC/USD maintains advantageous positions near the $37.5k level, giving reason to believe that the upward movement may continue this week. The possibility of a correction still exists, but as the festive December approaches, the chances of this happening are diminishing.

Bitcoin, like much of the financial markets, is growing thanks to the preservation of a favorable fundamental background. The majority of investors and traders on the CME believe that the Federal Reserve will not raise interest rates at the December meeting. Other macroeconomic factors, such as the job market, a decrease in inflation levels, and a decline in consumer confidence, also point in that direction.

However, two important events will be tied to the U.S. dollar this trading week—GDP data on Wednesday, November 29th, and a speech by the Federal Reserve Chairman Jerome Powell on Friday, December 1st. These events can have a significant impact on the cryptocurrency market if new data emerges that contradicts the current state of the macroeconomic background. In other words, Bitcoin will have enough reasons for impulsive price movements.

Despite several unsuccessful retests of the $38k level, Bitcoin confidently maintains bullish positions near the psychological resistance area. In addition to fundamental factors, crypto investors are confident that the SEC will soon approve a spot BTC ETF, which, according to Glassnode, could bring over $70 billion to the cryptocurrency market. Despite the potential benefits, JPMorgan analysts claim that a significant portion of the current rally is momentum-driven and lacks fundamental reasons.

At the same time, colleagues from Morgan Stanley stated that they expect a significant increase in the BTC price after the halving in April 2024. Alongside these processes, long-term investors continue to actively accumulate BTC coins. According to IntoTheBlock data, more than 1 million addresses hold a minimum of 1 BTC, which is a bullish indicator. Considering all these factors, it can be confidently stated that short-term positivity in the crypto market persists.

On Friday, Bitcoin reached a new annual high, breaking through the $38k level and momentarily reaching $38.3k. Subsequently, sellers pushed the price below the $38k level, and for the remainder of the weekend, Bitcoin consolidated. As a result, as the new trading week begins, BTC is near the $37.4k mark, with daily trading volumes around $15.2 billion. While, fundamentally, Bitcoin maintains its bullish potential, technically, the momentum has diminished.

After forming a local upward channel, Bitcoin essentially shifted to consolidation within the $35.5k–$38k range. The cryptocurrency barely managed to update its local high last week, but the reaction from sellers remains swift and widespread. The stochastic on the 1D chart again indicates a decline in the BTC price, and the MACD confirms the strengthening bearish sentiment.

At the same time, taker volumes continue to rise amid BTC/USD's inability to establish itself above $38k. The absence of positive news related to the approval of BTC ETF also diminishes traders' investment appetite, which will soon lead to a full correction or consolidation within broader ranges of $33k–$38k, $31k–$35.5k. However, the current week and the fundamental triggers that Bitcoin has may allow the cryptocurrency to achieve the coveted breakout above the $38k level.

In many ways, the current trading week will be decisive for the price movement of Bitcoin in the coming weeks. If the cryptocurrency breaks through and firmly establish itself above $38k or once again update its local high, the status quo will be maintained. Otherwise, we can expect a gradual decline in price within the consolidation due to the prevalence of profit-taking volumes over long-term accumulators.