Bitcoin Recovers From $46K Level, But Several Factors Could Prevent Stronger Breakout

After dropping below $45,000 on March 31, Bitcoin (BTC) surprised investors with a faster-than-expected recovery to the $46,500 level.

Data from Coin-Crypto Markets Pro and Trading Display shows that bears managed to push BTC down to a low of $44,210, before bulls took effect to push the price back above $46,500 by midday.

BTC/USDT 1-day chart. Source: TradingView

Here’s what several analysts are saying about the near-term outlook for Bitcoin going forward and what developments could present headwinds for the major cryptocurrency as a new month kicks off.

The macro environment continues to affect BTC price

Events in the global financial market continue to have a major impact on the cryptocurrency markets and are likely to continue to do so for the foreseeable future.

According to to Macro Hive CEO Bilal Hafeez: “Currently, Macro dominates Bitcoin,” as evidenced by the “last few days of equity weakness” that “has also led to Bitcoin declines.”

Hafeez also pointed to higher interest rates in the United States, a more aggressive Fed and weakness in Chinese markets as reasons for the current volatility in stock markets.

While these macro events continue to weigh on financial markets, Macro Hive noted that there are signs of hope in Bitcoin-specific statistics.

hafeez said,

“Bitcoin-specific dynamics are bullish with exchange-traded fund (ETF) re-inflows, open interest rates rising and HODLers accumulating.”

Traders Waiting to Break Above $48,000

According to David Lifchitz, managing partner and chief investment officer at ExoAlpha, the decline in BTC price in the past 24 hours was somewhat to be expected. Lifchitz pointed to Bitcoin’s “seven-day win streak” and trend-of-quarter activity from institutional investors as contributing to the decline.

Despite the March 31 pullback, Lifchitz indicated that “the upward support trendline from March 21 remains intact,” and is likely to hold out as a support, barring a “revision of the low $40,000 in the coming days.”

“Wildcards” identified by Lifchitz that could influence this outlook include “the situation in Ukraine, the EU finance commission taking revenge on crypto and the liquidation of Mount Gox that could come any day.”

Lifchitz said,

“A break above $48,000, then $51,000 is what the bulls are looking for, so we’ll see if they get served next week (new quarter = potential for new institutional influx.”

Related: Only 2 Million Bitcoin Left: Bitcoin Hits 19 Million Milestone

BTC is at the end of a major correction period

One last bit of reassurance was offered by market analyst Will Clemente, who: Posted the following chart shows BTC’s “pretty clean response to this pullback so far.”

BTC/USDT 1-day chart. Source: Twitter

The significance of the April 1 bounce was succinctly summarized by market analyst and pseudonymous Twitter user PlanC.

The total cryptocurrency market cap now stands at $2.137 trillion and Bitcoin dominance is at 41.1%.

The views and opinions expressed herein are solely those of the author and do not necessarily reflect the views of Every investment and trading move involves risks, you should do your own research when making a decision.

Leave a Comment