The 200-week moving average is just one of a series of lines in the sand for Bitcoiners to keep their eye on this week.
Bitcoin (BTC) is pressuring newly-won support levels this week as geopolitical uncertainty raises the stakes for risk assets.
Volatility was cool as August began, but angst over a potential showdown between the United States and China over House Speaker Nancy Pelosi’s visit to Taiwan is already showing in Asian trading on Aug. 2.
Amid talk of a “bear market rally” being all that can describe the current setup, Cointelegraph takes a look at the crucial support and resistance levels currently facing the market on short timeframes.
Traders unconvinced over fate of 200-week moving average
Analyzing order book data on Binance, the largest exchange globally by volume, pockets of buy and sell interest stand out immediately.
At present, BTC/USD is eating through a band of bids just below $23,000. Should all that liquidity be taken, however, there is little more to support price action until closer to $21,000.
The strength of buy and sell “walls” on the Binance order book can be deceptive, as large-volume players can quickly move bids or asks from one level to the next.
The latest data was uploaded to social media by on-chain analytics resource Material Indicators on Aug. 1. It additionally highlighted the importance of Bitcoin’s 200-week moving average (MA) at just above $22,800.
BTC/USD 1-week candle chart (Bitstamp) with 200 MA. Source: TradingView
Certain whales, Material Indicators noted, were attempting to keep the 200-week MA as support but seeing little consensus from other trader groups, something which resulted in a subsequent dip below the trendline.
“Doesn’t look they are getting much help from other classes. Not sure how long they can keep this up,” part of accompanying comments read.
BTC/USD buy and sell levels (Binance). Source: Material Indicators
$26,000 then “new lows”?
Despite the Taiwan situation unnerving markets on the day, a short-term move higher for Bitcoin is not off the table, even for some of its most conservative analysts.
For popular Twitter account Il Capo of Crypto, BTC/USD even had the potential to hit $25,000 before returning lower than current levels.
Responding, fellow trader Jibon suggested that it could be $26,000 before a bearish pivot enters.
— Trader_J (@Trader_Jibon) August 2, 2022
While they kept quiet on a potential downside target, Venturefounder, a contributor to on-chain analytics platform CryptoQuant, called $22,000 a “good price” to set up a BTC long.
Altcoins, including Ether(ETH), looked less appetizing.
“I still think most altcoins are too expensive for this part of the cycle, or should I say Bitcoin is too cheap?” he queried on Aug. 1.
“$22k is still good price to long BTC for me. Can’t say the same for altcoins, not even $ETH.”
ETH/USD traded below $1,600 at the time of writing, down around 4% on the day but still 12% higher than the same time a week ago.
“Unless you think ALTs are going to break to their ATH against BTC soon, makes no sense to long,” Venturefounder added.
A look at the ETH/BTC chart meanwhile shows the importance of 0.075 resistance for ETH bulls, this failing to crack during the July crypto rally.
ETH/BTC 1-day candle chart (Binance). Source: TradingView
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