Bitcoin Faces Risky Territory as Whales Sell Off
Bitcoin (BTC) is starting the week in a risky position as sell-offs from whales indicate a change in sentiment. The recent weekly close has not reassured traders, and the “up only” price activity for BTC has paused. There are two weeks left until the end of the year, and pressure is building across risk assets. Key macro data releases, such as United States gross domestic product (GDP) figures, are expected to impact short-term volatility in December. Despite hopes for a “Santa rally,” Bitcoin’s high fees have dampened expectations. However, market sentiment remains greedy but not unsustainable, leaving room for potential upside.
Analysts Identify Key Support Levels for BTC Price
Bitcoin’s weekly close on December 17th occurred during a local sell-off for BTC/USD at around $41,300. Traders and analysts are cautious about potential further dips based on recent price action. Material Indicators noted that Bitcoin had lost its 21-day moving average, which is considered bearish. The battle for a key Fibonacci retracement level corresponding to the November 2021 all-time high continues. Popular trader Skew identified technical support levels around $39K-$38K and resistance levels around $47K-$48K.
PCE and GDP Data Influence Fed “Pivot” Belief
The upcoming week will see the release of the November Personal Consumption Expenditures (PCE) Index, which is the Federal Reserve’s preferred inflation gauge. This data is crucial in showing whether inflation is abating as markets anticipate a potential pivot in Fed policy. The next Federal Open Market Committee (FOMC) meeting is not until January, but markets have already started pricing in a rate cut by July 2024. Key macro figures, such as Q3 2023 GDP data, will also impact market sentiment.
Bitcoin Transaction Fees Remain Elevated
The debate over Bitcoin transaction fees has intensified as fees reach their highest levels since April 2021. Some argue that the fee market is functioning as intended due to competition for block space, while others criticize the high fees. However, fees have already fallen considerably at the start of the new week. Market participants are now shifting their focus to the decision on approving the first U.S. spot Bitcoin ETFs in January.
New BTC Addresses Pose Risk to Bull Market Momentum
The number of new
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