Bitcoin confirms the false breakdown, sentiment recovers to fear and The GLI continues to go sideways as we brace for a pivotal FOMC meeting this week with the new FED chair.
The Weekly Close
After a brief dip below the 200W MA early in the week, Bitcoin managed to close back above it once again by the weekly close. This is a clear sign of demand below the 200W MA and exactly what we want to see from bulls at these prices. This is now a confirmed false breakdown below $60k which means that momentum is shifting from the bears back to the bulls here. This doesn’t mean Bitcoin will skyrocket tomorrow, but it does mean that accumulation is underway and the probability of upside is increasing rapidly.
Market Sentiment
Market sentiment has slightly recovered back to Fear. I’m glad we took advantage of Extreme Fear over the past few weeks and bought the dip while sentiment was that extreme. I hope we get another chance to accumulate in Extreme Fear later this year, but that isn’t guaranteed. Taking advantage of extremes while also saving some dry powder for future opportunities continues to be a cheat code in this market
The Global Liquidity Index
The GLI perfectly timed the February low and May high. It now seems to have perfectly timed the June low. However, we are still waiting for a GLI breakout to really get optimistic that the bottom is in. The GLI is not the only driver of Bitcoin, but I do believe it is the main driver so it continues to be a useful tool in the toolkit. Let’s see what The GLI decides to do over the next few weeks.
FOMC Meeting
There will be an FOMC meeting on Wednesday, June 17th. This is an especially important meeting because it will be Kevin Warsh’s first FOMC as chair. Going into the meeting the market is pricing in one rate hike over the next 12 months so the market will be listening closely to what Kevin Warsh says and react accordingly. If Warsh is more hawkish than expected, I expect rate hike odds to rise and volatility across markets. If Warsh is more dovish than expected I expect markets to react bullishly.
The Bigger Picture
As I have been saying over the past few months, this is the price area where I expect Bitcoin to bottom. The 8-month consolidation range from 2024 continues to act as solid support and I expect it to continue doing so. We are at the 200W MA and buyers have been stepping in quite nicely which further increases my conviction in the shallow bear market base case. Regardless, I will make sure to be prepared for multiple outcomes so that I can navigate this market no matter what happens
The Weekly Close
After a brief dip below the 200W MA early in the week, Bitcoin managed to close back above it once again by the weekly close. This is a clear sign of demand below the 200W MA and exactly what we want to see from bulls at these prices. This is now a confirmed false breakdown below $60k which means that momentum is shifting from the bears back to the bulls here. This doesn’t mean Bitcoin will skyrocket tomorrow, but it does mean that accumulation is underway and the probability of upside is increasing rapidly.
Market Sentiment
Market sentiment has slightly recovered back to Fear. I’m glad we took advantage of Extreme Fear over the past few weeks and bought the dip while sentiment was that extreme. I hope we get another chance to accumulate in Extreme Fear later this year, but that isn’t guaranteed. Taking advantage of extremes while also saving some dry powder for future opportunities continues to be a cheat code in this market
The Global Liquidity Index
The GLI perfectly timed the February low and May high. It now seems to have perfectly timed the June low. However, we are still waiting for a GLI breakout to really get optimistic that the bottom is in. The GLI is not the only driver of Bitcoin, but I do believe it is the main driver so it continues to be a useful tool in the toolkit. Let’s see what The GLI decides to do over the next few weeks.
FOMC Meeting
There will be an FOMC meeting on Wednesday, June 17th. This is an especially important meeting because it will be Kevin Warsh’s first FOMC as chair. Going into the meeting the market is pricing in one rate hike over the next 12 months so the market will be listening closely to what Kevin Warsh says and react accordingly. If Warsh is more hawkish than expected, I expect rate hike odds to rise and volatility across markets. If Warsh is more dovish than expected I expect markets to react bullishly.
The Bigger Picture
As I have been saying over the past few months, this is the price area where I expect Bitcoin to bottom. The 8-month consolidation range from 2024 continues to act as solid support and I expect it to continue doing so. We are at the 200W MA and buyers have been stepping in quite nicely which further increases my conviction in the shallow bear market base case. Regardless, I will make sure to be prepared for multiple outcomes so that I can navigate this market no matter what happens
