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(Kitco News) – The overall cryptocurrency market trended higher on Wednesday, with a majority of tokens in the top 100 making small gains, while a positive day in the traditional markets saw the S&P 500, Dow and Nasdaq rise 1.56%, 1 .29%
Data provided by TradingView shows that the price of Bitcoin (BTC) rose 3.75% from a low of $22,805 in early trading hours to reach a daily high of $23,661 before retreating to support near $23,400.
BTC/USD 4-hour chart. Source: TradingView
The green day for financial markets follows the much-hyped visit of US House Speaker Nancy Pelosi to Taiwan, a trip that generated a lot of buzz and aggressive posturing from Beijing over the past week. So far, the response from China has been muted, helping to encourage traders to remain active in the markets and adopt a more “risk-on” approach.
Outlook for Bitcoin going forward
The positive gains across the cryptocurrency market over the past couple of months were noted in Wednesday’s morning brief from Kitco senior market analyst Jim Wyckoff, who highlighted the fact that “Prices are still in a six-week-old price uptrend on the daily bar chart, but just barely.”
Now is no time for complacency, however, as a 10% reduction in Bitcoin’s 24-hour trading volume suggests a slowdown in momentum, prompting Wyckoff to comment that “bulls need to step up and show power soon to keep the uptrend alive. “
Insights into key support and resistance levels for Bitcoin that traders should keep an eye on going forward were offered by Twitter user Crypto Tony, who suggested that a close above $23,500 would be a good signal to open a long position while a drop below support at $22,650 may be an appropriate time to open a short.
Keep it simple this morning #Bitcoin ..
– Well above resistance at $23,500
– Short under support at $22,650 pic.twitter.com/onXXRvdXx8
— Crypto Tony (@CryptoTony__) 3 August 2022
While the positive gains of the past six weeks have been a welcome sign for crypto faithful, seasoned participants know that the market is not out of the woods yet, as past crypto winters have witnessed bear market rallies followed by more recent declines.
A historical perspective on when the bottom for BTC might occur was offered by market analyst Rekt Capital, who posted the following tweet, which suggests that the bottom will occur in Q4 of 2022.
In 2015, #BTC bottomed 547 days before the halving
In 2018, $BTC bottomed 517 days before Halving (discount in March 2020)
If Bitcoin bottoms out 517-547 days before the upcoming halving in April 2024…
— Rekt Capital (@rektcapital) 2 August 2022
Altcoins close the day mixed
It was a mixed day for the Altcoin market as a large percentage of tokens saw modest gains while Ethereum (ETH) booked a small decline of 0.37% and Solana (SOL) fell by 4% after the latest setback.
Daily performance in the cryptocurrency market. Source: Coin360
The top winners for the day were the layer-two protocol Optimism (OP), the liquid staking platform Lido DAO (LDO) and the proof-of-work protocol Kadena (KAD), which posted gains of 25.62%, 15% and 9.68 % respectively.
The total cryptocurrency market cap is now $1.083 trillion, and Bitcoin’s dominance rate is 42.1%.
Disclaimer: The views expressed in this article are those of the author and may not reflect the views of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is for informational purposes only. It is not an invitation to exchange goods, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept responsibility for any loss and/or damage arising from the use of this publication.