FX.co ★ Technical Analysis of BTC/USD for November 17, 2022

Crypto Industry News:

The collapse of cryptocurrency exchange FTX has derailed an emerging positive outlook in cryptocurrency markets after significant deleveraging in May and June left few, if any, marginal sellers in the digital asset space.

The new turmoil in the cryptocurrency market and the lack of big buyers have left the sector vulnerable, potentially extending an already long cryptocurrency winter. FTX insolvency proceedings will be closely monitored. However, for the digital asset sector, much depends on the path of US interest rates.

It is highly likely that the market will see "side effects" from the collapse of FTX. It will be revealed who has borrowed or interacted with the exchange or its company, Alameda Research, and what those liabilities are.

Poor liquidity could last at least until the end of the year and stablecoin dominance could rise to a very high 18% of total cryptocurrency market capitalization. That factor dropped to about $800 billion as of November 12. At the end of last month, the market capitalization was around $1 trillion.

Technical Market Outlook:

The volatility dried up after Bitcoin bounced from the swing lows located at the level of $15,555 and tested the technical support seen at $17,600. Moreover, the bulls retraced 38% of the whole sell-off and hit the level of $18,135 before the pull-back towards the sell-off lows was made. The market conditions on the H4 time frame chart are still oversold, however, no significant breakout has been made yet as the market keeps trading up and down in a whipsaw mode. The nearest technical resistance zone is seen at $17,600, $18,150 and $18,220. There is no indication of the down trend to terminate or reverse just yet as the market keeps trading in a relatively narrow range.

Weekly Pivot Points:

WR3 - $18,079

WR2 - $17,175

WR1 - $16,785

Weekly Pivot - $16,272

WS1 - $15,888

WS2 - $15,369

WS3 - $14,456

Trading Outlook:

The down trend on the H4, Daily and Weekly time frames continues without any indication of a possible trend termination or reversal. So far every bounce and attempt to rally is being used to sell Bitcoin for a better price by the market participants, so the bearish pressure is still high. The key long term technical support at the psychological level of $20,000 had been violated, the new swing low was made at $15,555 and if this level is violated, then the next long-term target for bulls is seen at $13,712. On the other hand, the gamechanging level for bulls is located at $25,367 and it must be clearly violated for a valid breakout in the long term.