FX.co ★ Technical Analysis of BTC/USD for January 4, 2023

Crypto Industry News:

The FDIC (Federal Deposit Insurance Corporation) and two other US regulators have issued a warning to banks regarding cryptocurrencies.

In a joint statement, the Federal Reserve Board of Governors, the Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency (OCC) said banks should be aware of the "significant volatility and vulnerability" the cryptocurrency sector has experienced over the past year.

Regulators added that cryptocurrency-linked banks could be particularly at risk. The so-called "challenger banks", a new generation of financial institutions, have started to offer digital asset services around the world.

"Based on the current situation and past experience, our agencies believe that issuing or holding core crypto assets that are issued, held or transferred on an open, public and/or decentralized network or similar system is likely to be inconsistent with secure banking practices " - we read in Monday's statement.

Technical Market Outlook:

The BTC/USD pair had keeps trading above 100 MA on the H4 time frame chart as the spike up continues towards the key short-term technical resistance. A breakout above the level of $17,057 is needed in order to extend the rally towards the key short-term technical resistance seen at $18,360, but for now the bulls are still trading below the level of $16,950. On the other hand, any breakout below the range low would extend the corrective cycle towards the level of $15,984 (November 28th low). Strong and positive momentum support the short-term bullish outlook.

Weekly Pivot Points:

WR3 - $17,051

WR2 - $16,841

WR1 - $16,758

Weekly Pivot - $16,662

WS1 - $16,548

WS2 - $16,422

WS3 - $16,213

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. Moreover, there is a clear test of the 50 WMA located at the level of $15,600, so any breakout below the moving average and a weekly candle close below moving average will be considered as another indication of the down trend continuation. The new yearly 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 longer term.