Bitcoin (BTC) rallied overnight on August 5 as a fresh retracement of the trend line opened the door for further gains.
Daily BTC price chart creates “test” long signal
Data from Cointelegraph Markets Pro and TradingView it showed BTC/USD bouncing off the local low at $22,400 to add about 4.6%.
The pair had reversed direction right at key bid support on the main Binance exchange, which is helping to avoid a more significant loss of the 200-week moving average (MA) at around $22,800.
While this key zone remained uncertain for the bulls, the retracement of the 21-period MA on the daily chart gave cause for optimism in on-chain analysis resources in the Material Indices.
BTC/USD may not give a long signal to the daily close of the candle, he told Twitter followers overnight.
It helps if I post the chart with it. It was worth the wait. #BTC regained 21-DMA and Trend Precognition A2+ aglo started flashing a new signal. It’s tentative until D closes. pic.twitter.com/gpTSxrikeT
— Hardware Algos (@MI_Algos) August 5, 2022
However, trader and analyst Rekt Capital expressed continued caution about Bitcoin’s poor record of turning its 200-week MA into solid support in this bear market.
“Historically, BTC has been able to generate huge buying interest at the 200-week MA,” he said. he argued.
“But if $BTC fails to retest the MA in the near term, that will likely serve as further evidence that this rally is just a blip.”
Similarly conservative in its price outlook was trading firm QCP Capital, which in its latest market update told Telegram channel subscribers that the overall picture was “very mixed.”
Pointing to complex macroeconomic factors, QCP said the United States Federal Reserve’s monetary policy will be a decisive market mover going forward. Fed Chairman Jerome Powell, he noted, had not reached a consensus on the pace and range of future key rate hikes.
“Global economic data points to poor growth and a looming global recession,” the update read, highlighting the upcoming Consumer Price Index (CPI) inflation data for July due on August 10.
“We continue to believe that markets will trade sideways and be sensitive to economic data releases. The US CPI next Wednesday will be the next big one to watch.”
The power of Ethereum fails to convince
In altcoins, Ether (ETH) and other large-cap tokens joined Bitcoin’s relief rally.
Related: 3 Key Ether Derivatives Metrics Suggest $1,600 ETH Support Lacks Strength
ETH/USD was circling $1,665 at the time of writing, with ETH/BTC however failing to break the resistance closer to the 0.075 mark after a second retracement.
With the Ethereum merger about a month away, concerns were also growing about the possibility of a controversial hard fork of the network.
“The most pressing and immediate risk in the crypto markets is the ETH merger scheduled to take place in September,” QCP continued.
He added that markets had already “started to price in the possibility of a material hard fork.”
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