The Bitcoin Price Is At A ‘Critical Crossroads,’ According to Huobi Research
Bitcoin is facing one of the most severe tests since November 2021, when it reached an all-time high of $64,789 per coin. On-chain researchers believe that the largest cryptocurrency is reaching a “critical crossroads” as it falls under pressure.
According to analysts at Huobi Research Institute, the interaction of multiple variables may push Bitcoin to dizzying lows or spark another huge bounce. Bitcoin plummeted below $40,000 last week, shedding nearly 10% of its value as investors grappled with the magnitude of the loss.
“The market is at a crossroads, and the outcome will decide the future path of Bitcoin,” William Lee, a senior researcher at the Huobi Research Institute, stated. The institute’s statements are based on macroeconomic indicators and technical indicators that indicate Bitcoin’s precarious position.
In Europe, the war between Russia and Ukraine fueled a significant surge for Bitcoin, as both sides exploited the currency. Ukraine used cryptocurrency to raise significant sums of money for charity, while Russian organisations considered using it to dodge sanctions. Russian residents also went to Bitcoin as a hedge against the fast depreciating ruble, which boosted Bitcoin’s value.
According to the research centre, the G7 nations’ efforts against Russia in restricting the crypto sector may have been detrimental to Bitcoin’s price and may have contributed to the fall in events. The Federal Reserve’s activities in proposing to increase interest rates are another source of contention for the institution.
“The US Consumer Price Index (CPI) has progressively recovered, and a monetary policy adjustment is unavoidable,” the paper said. The word on the street is that the Federal Reserve will boost interest rates to as high as 4%.
The Technical Details
Apart from macroeconomic issues, the institution cited many technical indicators that present a bleak picture for Bitcoin. It made reference to the Triple Peak Format and said that the asset is on track to reach its third peak since the asset launched its third bull in late 2020.
The Huobi Research Institute coined the term ‘Wave B’ to describe the new trend, which was partly sparked by the Russian-Ukrainian war. They contended that if the streak was maintained, a dramatic decline in prices may be predicted when Wave B transitioned to Wave C.
“If the present price remains inside the channel, the B wave will continue; if not, the market will collapse much more precipitously,” Lee said. He noted that the current RSI value is less than 50, indicating “a poor market.” However, this level has not yet fallen below 30, indicating that the market is not yet oversold.”