Bitcoin is recovering slightly, however, a prominent crypto market analyst is concerned that this trend will not last long.
Currently, Bitcoin is trading around $27,166, showing slight growth over the past 24 hours.
With BTC rallying, popular on-chain analyst Rekt Capital has again warned that the king coin may be forming an “exaggerated” bullish divergence on the daily RSI.
Also, according to Rekt Capital, if the price falls below the $27,600 resistance level, BTC could return to the $25,000-26,000 mark.
Besides Rekt Capital, an investor @DrProfitCrypto with nearly 190k followers also gave his opinion on the Bitcoin trend.
According to @DrProfitCrypto, there are 3 scenarios for BTC price:
Scenario 1: BTC breaks through the MA200 and heads towards the $37,500 mark. However, this is quite difficult to happen, especially with the amount of liquidity that is constantly flowing out of the market.
Scenario 2: BTC trades below MA200, it is highly likely that the price will retest $25,000, then create momentum for BTC to break out.
Scenario 3: This is a worst-case scenario for Bitcoin and BTC price could fall to a new low of $20,000. Before that, the BTC pump from 16,000 USD to 21,000 USD in January was Binance and Tether buying BTC. Currently, Binance and Tether are also gathering BTC like the first batch last year. If this scenario happens, Bitcoin can pump strongly to 37,500 USD.
There are a lot of factors that have hindered Bitcoin’s growth over the past few weeks. One of the most powerful factors was the rumor about the US government defaulting on its debt.
The dissent in key leaders’ negotiations has led some investors to take a different look at risky assets like Bitcoin.
Recently, President Joe Biden emphasized that a successful debt settlement is one that does not protect crypto traders. This implies that US regulatory authorities will actively crack down on cryptocurrencies and this is seen as a red-flag that is likely to keep investors away from injecting capital into the industry.
BREAKING: President Joe Biden speaking on the final day of the G7 summit
"I'm not going to agree to a deal that protects wealthy tax cheats and crypto traders while putting food assistants at risk."https://t.co/q2ATjj9RFh
📺 Sky 501, Virgin 602, Freeview 233 and YouTube pic.twitter.com/PIf0O5tKXq
— Sky News (@SkyNews) May 21, 2023
“I will not agree to a deal that protects the tax evasion tricks of the rich or crypto investors, only to replace it with eliminating food inspection for 1 million Americans.”
President Biden speaks to the media at the closing day of the G7 Summit held in Hiroshima (Japan)
Therefore, crypto traders need to understand the macroeconomic factors for long-term planning.