Bitcoin edges higher ahead of Powell speech

7 thg 2, 2023

Bitcoin was testing a key short-term support area around 22.5K to 22.7K at the time of writing on Tuesday, with investors awaiting direction from Powell’s speech due later in the session. Cryptocurrencies have sold off a little in the last few days thanks to in part to a rebounding US dollar and reduced risk appetite across the financial markets.

So far, the retracement in BTC/USD can best be described as a pullback inside a bullish trend. But that could change in the event of a decisive break below 22.5K support, for that level was the last low prior to the most recent rally above 24K.

If BTC breaks support at 22.5K, then the next level with prior reference point to watch for a potential bounce is between 21.2K to 21.5K, which also happens to be the base of the breakout in the last full week of January. And if BTC shows no signs of support there then things could start turning ugly again.

So, Bitcoin is testing potential support here, but given how it has struggled to find fresh buying momentum, there is a risk of a breakdown. There may be tactical shorting opportunities if some of the above conditions are met, with the most important short-term level to watch for a potential breakdown being around 22.5K.