As the BTC/USD chart shows, the price of the leading cryptocurrency briefly dipped below the psychological $90k level this morning, despite trading above $94k earlier in the week.
Why is Bitcoin falling today?
Among the key drivers, the following stand out:
→ Decline in the geopolitical risk premium. Bitcoin’s rise earlier this week was supported by news of Maduro’s detention and US actions in Venezuela. However, this factor is now losing relevance.
→ Ahead of key macroeconomic data. On Friday, the US Nonfarm Payrolls report is due to be released. Recent ADP Employment Change data suggest that Friday’s figures could point to a recession in the US. In such an environment, traders may seek to reduce exposure to risk assets.
Technical analysis of the BTC/USD chart
On 18 December, we discussed Bitcoin’s price action within a system of two channels, which remain relevant. This week, as indicated by the red arrow:
→ the channel median acted as resistance;
→ on the CME exchange, futures prices posted a false bullish breakout above the December high (A).
These observations suggest that bears retain strength in the medium term. However, a sharp rebound from the $90k level (marked by the black arrow) points to renewed bullish activity. Therefore, if bears are indeed targeting a break below the lower boundary of the ascending channel, they will need to exert considerable pressure to push BTC/USD below this key psychological level.
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