Bitcoin has seen a slight price recovery after a decline, facing crucial resistance levels.
Current Bitcoin Situation
Bitcoin's price increased to $84,525 on Saturday, up 10% from this month's lowest level. Despite the increase, Bitcoin has declined over 22% from its peak this year. At the time of this publication, it is trading slightly above $84,335. Bitcoin and other altcoins rose slightly on Friday, reflecting similar movements in other assets like stocks and gold. The Dow Jones index rose by 650 points, and the S&P 500 and Nasdaq 100 gained 117 and 450 points, respectively. Gold hit a record high of $3,010.
Risks for Bitcoin Price
Bitcoin's recovery faces two main risks. First, investors still have a sense of fear: the fear and greed index has exited the extreme fear zone but remains at 22, indicating fear. This fear helps explain Bitcoin spot ETF outflows totaling $143 million, leading to weekly outflows reaching $870 million over the last five weeks. Second, technically, a 'death cross' has formed as the 50-day and 200-day Weighted Moving Averages have crossed, suggesting potential further downside. Bitcoin may still retest the $73,900 level, seen in March 2024.
Opportunities for Bitcoin
There are potential opportunities for Bitcoin's recovery. First, investors should pay attention to the Federal Reserve's outcomes, as their meeting on March 18-19 could lead to a change towards a dovish tone in response to recession concerns, which would benefit Bitcoin and altcoins. Second, investors may seize the opportunity to buy the dip due to the pricing in of extreme tariff risks. This mirrors past behavior, such as during the COVID-19 pandemic, when a highly dovish attitude by the Federal Reserve led to buying interest after an initial panic sell-off.
Bitcoin's outlook remains uncertain amid current risks and potential opportunities. Investors need to closely watch macroeconomic trends and technical signals.
