Weekly Bitcoin Estimate Released: Here Are the Expected Levels!

Bitcoin price has seen an increase in volatility after the release of the US Consumer Price Index (CPI) on Thursday. The first drop in BTC price was later taken over by buyers, resulting in a sharp move to the upper truth. CPI came out at 8.2 percent, above the claim of 8.1 percent. Well, what will happen in the next period? Here is the Bitcoin assumption and analysis of analyst Akash Girimath…

Bitcoin claim: Correlation with the stock market continues, what will be the result?

Koindeks.com As we have also reported, after the CPI announcement, the price of Bitcoin dropped to $ 18,190. However, BTC price quickly recovered and climbed as high as $19,500. According to the analyst, going forward, news affecting the stock market will also affect cryptos. Because the tight correlation between the two continues. However, there is an interesting development that signals the beginning of an uptrend, at least in the short term.

Bitcoin price was already correlated with the stock market with the correlation coefficient varying in the middle of 0.1 to 0.7 until November 2021. But since 2022, the correlation has strengthened with the number staying at or above 0.90 for a longer period of time. Another interesting observation is that there have been four obvious decreases in the correlation in the last four months, two of which coincided with the CPI announcements. For example, on July 13, the CPI came in at 9.1 percent, higher than 8.8 percent. After that, the correlation dropped from 0.88 to 0.16.

Bitcoin likely to rise if history repeats itself

On October 13, after the CPI announcement, the correlation dropped from 0.75 to 0.31. That is, it was 0.1 percent higher than the expected 8.1 percent. Both decreases coincide with the exact time when the CPI came in higher than expected. However, the drop in BTC price on July 13 catalyzed a 33 percent rally. According to analyst Akash Girimath, if history repeats itself, yesterday’s drop in Bitcoin price could be the start of another rally.

According to the analyst, if the bullish thesis is correct, the four-hour chart shows that the ideal place for accumulation is $18,935. Apart from that, the midpoint of roughly $19,000 also seems appropriate. According to Girimath, BTC should produce a daily candlestick around $19,600 above the 30-day Exponential Moving Average (EMA). If it does, this rise will be confirmed.

BTC price bounce could point to $25,000

If buyers step in, the bounce in Bitcoin price could deepen. According to the analyst, such a move could be the start of the rally that pushes the crypto to test the $25,000 level again. Emphasizing the importance of the mentioned drawback, the analyst says, “Investors should set aside some of their profits to cover their risks.” However, turning the $25,000 level into a reinforcement barrier will be a sign that the bulls are back. In such a case, market participants would expect BTC to run to the $28,000 to $29,000 levels. Interestingly, these levels are where price gaps occur every weekend in CME Bitcoin contracts.

There are other data supporting this $27,000 or higher level. One of them is the process information obtained from IntoTheBlock’s Global In/Out of the Money (GIOM) model. This metric shows that about 5.24 million addresses are “in the money” that have bought about 3.2 million BTC at an average price of $21,450. As such, turning that snag into a reinforcement base could give these investors a chance to add more to their holdings. According to the analyst, this may cause an increase in buying pressure, which increases the price of Bitcoin.

On the other hand, if Bitcoin price fails to break above $21,450, or roughly $21,500, it will indicate weak buying pressure. This development will bring BTC down and it could produce a daily candlestick near the $19,000 level. In this case, the bullish view becomes invalid. Such a development will invite panic sellers to sell their assets. It will put more selling pressure on the investor cluster and trigger a sell-off. As a result of this move, the Bitcoin claim also changes. According to Girimath, Bitcoin price risks returning to the $15,500 support level.

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