As traders embraced the possibility that there might not be a Santa Claus bounce in 2022, asset prices on Monday continued to be impacted by last week’s Fed-inspired downturn. While other significant digital assets follow, the price of Bitcoin keeps declining.
BTC is struggling to recapture the bullish momentum and appears in danger of falling back to its yearly lows. To stop further declines, the bulls should hold the line near $16,200 to $16,500. Rekt Capital previously stated that holding the $17,150 level would be necessary for bitcoin. If the month ends below the support, bitcoin price could continue to accelerate towards $13,900. Additionally, bitcoin price should breach the $18K-$19K zone for a major rally to take place.
Crypto analyst Michael van de Poppe believes that if Bitcoin breaks the $16,900 barrier, it might have a strong rally. Additionally, maintaining support around the $16.5K level for Bitcoin is crucial for the price surge to $18K.
On-chain data signals a selloff
According to data from material indicators, an increase in volatility is predicted for the coming week. The US will release information on its labor market on Thursday. If the nation’s economy remains strong, the Fed will have the support it needs to continue raising interest rates.
According to on-chain data, people who have held bitcoin for a short period of time, namely 3-6 months, are currently dumping their holdings. A selloff by Bitcoin holders with a holding period of three to six months was what caused the Monday price decrease in BTC. Spent Output Age Bands rise for 3-6 month holders has historically been followed by significant downward fluctuations. In reality, a sudden change took place immediately before the FTX crisis.
