Bitcoin Price on Cusp of Further Capitulation, Michael Kramer Weighs In
A fall in Bitcoin price could pull the entire altcoin industry amid reduced crypto liquidity fueled by increased scrutiny from US regulators.
The most valuable digital asset Bitcoin (BTC) has struggled to continue with the new year’s crypto relief rally in the past two months. Trading around $26, 699 on Monday, Bitcoin price dropped approximately 1.7 percent in the past 24 hours. Nevertheless, the top coin is up approximately 60 percent YTD, outperforming the entire stock market indexes. The $517 billion valued digital asset had a crypto market dominance of about 47.86 percent.
Notably, the weekly Bitcoin dominance has in the recent past experienced heightened resistance around 48 percent, which signals a possible market reversal. Such a narrative is also supported by the rise of crypto meme coins, which mostly signals the end of an era.
The money circulation in the crypto market moves from large-cap altcoins to small-caps and then meme coins as speculation of bullish sentiment fade over time.
Bitcoin Analysis by Michael Kramer
According to a recent Bitcoin price breakdown by respected market analyst Michael Kramer, Bitcoin price is on the cusp of major capitulation. More. precisely, the analyst noted that Bitcoin price has a high possibility of revisiting the $20k level. Having struggled to regain above $27k in the past weekend, the analyst noted that the falling trend that began after topping out from $29.5k could push Bitcoin price much lower in the coming days.
Watching #bitcoin $btcusd here for potential breakdown. Very good leading indicator for risk assets in general. A breakdown is not a positive for #stocks pic.twitter.com/HEdgXe2nEH
— Michael J. Kramer (@MichaelMOTTCM) May 21, 2023
As a result, Kramer highlighted that a breakdown for Bitcoin is not positive for the stock market which is also on the edge due to high inflation and possible recession in the second half of 2023. The analyst compared the Bitcoin falling trend to the struggling S&P 500 bulls around 4,200.
When the McClellan Summation index diverges from the direction of the equity index it tends to not lead to good outcomes sometimes. But you can decide for yourself. pic.twitter.com/fMfLiX3gla
— Michael J. Kramer (@MichaelMOTTCM) May 21, 2023
More Pain Ahead
The rising geopolitical crisis between global superpowers has significantly segmented international trade through sanctions thus affecting the general supply chain. Already, Europe has been cut from Russia’s oil and gas supply due to the ongoing war in Ukraine. As a result of increased sanctions from the West, Russia has teamed up with several other countries including China, Brazil, India, and South Africa to form a trade block away from the United States dollar as a global currency reserve.
The United States federal government has been blamed for printing more money out of thin air at the expense of other countries holding the dollar as a reserve currency. Consequently, analysts forecast the S&P 500 will dip significantly from current levels in the coming weeks and months.
Late last week, Federal Reserve Chairman Jerome Powell hinted that the time for interest rate hikes is around the corner. Notably, the Fed has been struggling to bring down inflation to the desired 2 percent amid the banking crisis.
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