Bitcoin Must Hit $59.1K Weekly Close for New High

Bitcoin (BTC) enthusiasts have their eyes set on a critical price target for the week in an attempt to take some pressure off the bullish market. Popular trader and analyst Rekt Capital has emphasized that Bitcoin’s next weekly close must hit $59,000 to reignite confidence among bulls. As Bitcoin struggles to recover from recent lows, the crypto market is rife with uncertainty and potential challenges ahead.

BTC Price Faces Undefeated Resistance Hurdles

Bitcoin’s journey towards market stabilization continues as it attempts to recover from a recent dip to $49,500—its lowest in six months. Bears may reclaim control, causing further volatility. Analyzing the long-timeframe landscape, Rekt Capital identified a potential long-term bounce, which has been consistent since Bitcoin’s all-time high in March. “It has happened,” Rekt Capital wrote, referring to BTC’s upward reversal right on target.

Reclaiming Critical Support Levels

To sustain a successful reclaim of the support pattern, Bitcoin must close above approximately $59,110 later in the week. This would mark a reclaim of the bottom of the black channel as support, confirming a return to a favorable pattern. However, resistance remains a towering hurdle at the $70,000 mark and above, with BTC/USD showing a series of lower highs and lower lows since the March record.

Challenges in Market Strength

Zooming out, other analysts highlight further problems with Bitcoin’s market strength. Pseudonymous trader HTL-NL pointed out diminishing market elasticity due to decreasing Relative Strength Index (RSI) levels on monthly timeframes. “Word of warning: technically this looks like we had the cycle top already and not only that: we also had the bigger cycle top,” HTL-NL warned in a dedicated thread. The lower RSI levels at each high indicate diminishing strength, posing challenges to Bitcoin reaching new price discovery zones.

Hope from Global Macroeconomic Changes

Contrary to the technical challenges, some believe that global macroeconomic changes could fuel a resurgence in crypto and other risk assets. Known in financial circles, former BitMEX CEO Arthur Hayes is optimistic about a return to quantitative easing worldwide—an economic policy where central banks inject liquidity into markets, often boosting asset prices.

Predictions from Arthur Hayes

In his latest blog post, Hayes concluded that the United States would likely begin adding liquidity within days, potentially injecting $301 billion to $1.05 trillion between now and year-end. “TL;DR: Bad Gurl Yellen will inject $301bn to $1.05tn between now and year-end,” Hayes stated, referring characteristically to US Treasury Secretary Janet Yellen. He further suggested that Bitcoin’s near-term performance would hinge on the interplay with the US dollar and Japanese yen pair following the unwinding of the yen carry trade.

Current Market Status

At the time of writing on August 7, BTC/USD was trading around $57,500, as per data from Cointelegraph Markets Pro and TradingView. As Bitcoin heads into Wall Street’s open, traders and investors are closely watching movements for any signs of bullish momentum.

Implications and Future Projections

The upcoming weekly close is crucial for Bitcoin. Hitting the critical $59,110 target could revive bullish sentiment and provide a stronger support foundation. However, ongoing challenges in resistance levels and market strength indicators like RSI demand careful consideration and strategy from traders.

Key Takeaways

• Bitcoin must close above $59,110 for the week to reclaim crucial support levels.
• Resistance remains around the $70,000 mark, compounded by a series of lower highs and lows.
• Relative Strength Index (RSI) indicates diminishing market elasticity, complicating a return to price discovery.
• Global macroeconomic changes, particularly quantitative easing, could aid crypto market resurgence.
• Arthur Hayes predicts significant liquidity injections from the US Treasury, potentially benefiting Bitcoin.

Conclusion

Bitcoin’s path to recovery and potential new highs is laden with both opportunities and obstacles. While critical support levels and macroeconomic factors provide room for optimism, technical challenges remain a concern. Traders must stay informed and vigilant, balancing bullish hopes with grounded strategies. For further reading on Bitcoin market analysis, you can explore TradingView for real-time data or delve into Blockchain.info for comprehensive blockchain statistics.

The dynamic crypto market never sleeps, and neither should your vigilance. As always, thorough research and informed decisions are paramount in navigating this vibrant financial landscape.