Bitcoin bulls rejected the price at $36,000 as analysts warned of a decline to $33,000

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(Kitco News) – Cryptocurrency prices continued to consolidate on Tuesday as Bitcoin (BTC) bulls looked for reinforcement to reach the strong resistance level above $35,300, which has so far rejected multiple breakout attempts.

Stocks fended off an early morning sell-off that initially drove them into the red, climbed into the green around midday and held gains until the closing bell as investors became increasingly confident that the Federal Reserve has ended its campaign of interest rate hikes and will stick from here off things are stable or lower.

At the close, the S&P, Dow and Nasdaq finished higher by 0.28%, 0.17% and 0.90%, respectively.

Data provided by TradingView shows Bitcoin trended lower in the first half of the day, bottoming out at $34,530 around midday before an afternoon rally pushed it to an intraday high of $35,962. The bears rejected the attempt to reach the $36,000 level and are now in a battle for control of the price action near the $35,600 level.

BTC/USD chart from TradingView

Early bearish pressure led to “November Bitcoin futures prices.” [trading] weaker in early U.S. trading on Tuesday,” said Jim Wyckoff, senior technical analyst at Kitco.

Bitcoin futures 1-day chart. Source: Kitco

“Prices have paused at higher levels, and that is not pessimistic,” Wyckoff said. “BTC bulls still have a clear overall technical advantage in the short term as the price uptrend is still alive on the daily bar chart.”

Markus Theilen, head of research at Matrixport, noted that “Bitcoin rose +28% in October, increasing its year-to-date growth by +108%, surprising market participants and commentators.”

“Based on our historical analysis, the Bitcoin bull market is expected to continue,” Thielen said. “Bitcoin tends to be a solid trending asset as high prices attract more traders who follow the price movement. This in turn causes prices to rise even further.”

Historically, “If Bitcoin is up at least +50% by the end of October, there is, on average, a 78% chance that Bitcoin will continue to rise by the end of the year,” he said. “On seven out of nine previous occasions, Bitcoin gained an additional +68% on average by year-end. This analysis is based on thirteen years of Bitcoin history.”

Average annual Bitcoin return. Source: Matrixport

“While selling $26,000 BTC put options alone would not yield a significant return, a trader could buy half of the $45,000 BTC strike call options with these premiums,” Thielen said. “Heading into December, our price target of $45,000 from the Matrix on Target report appears to be well within reach.”

Confirming that the current rally is similar to previous bull cycles, market analyst Maartunn published the following chart showing that, like previous cycles, Bitcoin is up 120% about a year after hitting a low.

Like clockwork ⏰

This chart shows Bitcoin’s percentage change since the bottom of each cycle. And guess what: With each cycle, Bitcoin reaches around +120% about a year after the bottom.

This time no difference. And that’s impressive 😱 pic.twitter.com/cfEMLlTz9G

— Maartun (@JA_Maartun) November 7, 2023

But Maartunn also sees an indicator that could potentially spell trouble for BTC in the short term. “This chart shows the aggregate open interest of all cryptocurrencies except Bitcoin,” he tweeted. “Historically, every time this metric exceeded $12.2 billion resulted in at least a 20% decline in the price of Bitcoin.”

Aggregated open interest in all cryptocurrencies except Bitcoin. Source: Twitter

“Currently the metric stands at $13.8 billion, indicating a situation that requires significant attention,” Maartunn said.

Addressing the possibility of a pullback, Michaël van de Poppe, founder of MN Trading, said corrections are common in uptrending markets and highlighted $33,000 to $33,500 as a good range to open a long position.

Corrections occur in the markets. #Bitcoin will likely see a classic liquidity push towards $33-33.5K and then rise again.

These dips are entry points for your altcoins.

– Michaël van de Poppe (@CryptoMichNL) November 7, 2023

Mixed performance in the altcoin market

It was a mixed day for the altcoin market, with the top 200 tokens evenly split between winners and losers.

Daily cryptocurrency market performance. Source: Coin360

Ordinals (ORDI) saw the largest gain, rising 85.3%, thanks in large part to its listing on Binance, while Gnosis (GNO) gained 21.6% and API3 gained 17%. Memecoin (MEME) saw the biggest decline, falling 10.21%, while PancakeSwap (CAKE) fell 8.7% and Oasis Network (ROSE) fell 6.5%.

The total cryptocurrency market cap is currently $1.34 trillion, and Bitcoin’s dominance rate is 51.8%.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; However, neither Kitco Metals Inc. nor the author can guarantee this accuracy. This article is for informational purposes only. It is not a request to exchange goods, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no liability for any loss and/or damage arising from the use of this publication.

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