Bitcoin Pushes to $23K Still Open as Crypto Market Value Holds Key Support
Bitcoin (BTC) returned to $20,000 on September 2 amid renewed bets on a “short squeeze” higher.
Trader sees a short squeeze trigger at $20,700
Data from Cointelegraph Markets Pro and TradingView showed that BTC/USD recovered from another drop below the $20,000 mark on the day, continuing its range-bound behavior.
The pair gave little insight into what direction the next eruption might be, with differing opinions on the surrounding environment.
Amid downside pressure on risk assets and a strong US dollar, the general consensus appeared to favor long-term weakness continuing.
However, for popular Crypto trader Il Capo, there was still reason to believe that a burst of relief could come in first. Thanks to the majority of the market expecting immediate losses to continue, a “squeeze” of short positions could hit, pushing the spot price out of its multi-day trading range to target as much as $23,000.
“Mainbearish TL broken. Bullish confirmation for the short squeeze would be a breach of the 20700-20800 resistance. After this we should see 22,500-23,000,” he told Twitter followers on the day.
“Invalidation of the card clamp idea: break 19500 and main confirmation would be a clean break of 19000.”
Bitcoin circled $20,100 at the time of writing, requiring continued effort to enter the launch zone for the short squeeze.
On the dollar, other crypto sources claimed that the status quo was yet to show signs of fundamental change. The US dollar index (DXY) hit new 20-year highs on September 1.
People keep trying to call $DXY the top and the #BTC the bottom for no reason
I think it will be pretty clear when that happens
For now, we only get the sequel up $DXY and #BTC maintains low levels
There is no reason to believe that a change in trend is happening
— Kevin Svenson (@KevinSvenson_) 1 September 2022
“This will end in the capitulation of global markets and a blow off the top of the US dollar at some point,” analyst Matthew Hyland added.
“We’re not there yet.”
The DXY was consolidating around 109.3 at the time of writing, after reaching 109.97.
Crypto market cap gives hope of bear market
Meanwhile, Michaël van de Poppe, founder of fitness firm Eight Global, offered a more optimistic stance.
Related: Total Crypto Market Cap Continues To Crumble As Dollar Index Hits 20-Year High
In his final YouTube update of the day, Van de Poppe asked market participants to pay less attention to the Bitcoin chart and instead focus on the overall cryptocurrency market cap.
With BTC/USD trading below its 200-week moving average (MA) for an extended period – a first in Bitcoin history – it was “not unjustified” for sentiment to favor further losses.
“More importantly, it makes more sense to look at the total market value, as it provides more information about this,” he explained.
“The total market capitalization shows that support is around the corner, as it retained the 200 MA as support and rested on the previous all-time high as well.”
Van de Poppe thus predicted a potential retest of the 200 MA, upon which a clearer bottom signal would be printed “while most expect a crash towards $12,000.”
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