Bitcoin holding up well compared to other sectors

Considering the recent fall that we have seen in the precious metals and other sectors of the financial markets along with a higher dollar, BTC futures are holding up rather well. Since yesterday’s press conference with Chairman Powell and the renewed dot plot was released, many sectors, especially the safe-havens sold off drastically. A 3.5% decline was witnessed in the energy sector and 3% in financials, and 2.2% in materials. All of the precious metals are dramatically lower from where they were on Tuesday, with gold and silver both losing over 10% in the past two days of trading. Palladium, for instance, traded lower by over $350, a decline of 12.4% today alone.

Many analysts last week cited El Salvador’s adoption of Bitcoin as legal tender to be the source of much of its bullish momentum. If that were true, then today’s announcement by the IMF that they would not help El Salvador implement such a feat should have had much more drastic effects on the price of Bitcoin. Even more, drama with Elon Musk after he responded to a tweet by Bitcoin magazine quoting Kraken CEO, Jesse Powell who said, “Bitcoin is "greener" than critics say. "I think Elon has some more studying to do.” Musk responded by tweeting, “Based on what data?” These kinds of negative Bitcoin tweets by Musk used to drive down the price drastically just a few weeks ago but had little effect today. As of 5:30 PM EDT, BTC futures are trading down 2.3% or $890 lower at $37,675.

With such drastic declines over the past few days, Bitcoin has held up relatively well. Especially considering that it is trading against the U.S. dollar which has had 2% of its 2.2% increase this year in the last two days alone. If we continue to see pricing above $36,000, we could conclude that that has become the new minor support level. If we get a break below this level though that we are certainly going to retest $30,000. We see the more likely route being BTC futures breaking through resistance at 40,000 and testing the resistance at 44,000.