BTC and a Return to $30,000 in the Hands of First Republic Bank

Key Insights:

• On Sunday, BTC retargeted resistance at $30,000 before sliding back to end the session flat.
• First Republic Bank and private sector PMI numbers from China influenced.
• However, the technical indicators remain bullish, signaling a breakout from $30,000.

On Sunday, bitcoin (BTC) ended the day flat. Following a 0.29% loss on Saturday, BTC ended the week up 5.95% to $29,254. BTC avoided sub-$29,000 for the second time since April 18.

A bearish start to the day saw BTC fall to an early low of $29,113. Steering clear of the First Major Support Level (S1) at $29,052, BTC rose to a mid-afternoon high of $29,974. BTC broke through the First Major Resistance Level (R1) at $29,460 and the Second Major Resistance Level (R2) at $29,668 before sliding back to end the day at $29,254.

Recessionary Jitters, the SEC, and First Republic Bank Influenced

It was a relatively busy session. Economic indicators from China fueled recessionary fears. The manufacturing sector unexpectedly contracted in April, removing expectations of a post-COVID economic revival.

In April, the NBS Manufacturing PMI fell from 51.9 to 49.2, with the Non-Manufacturing PMI declining from 58.2 to 56.4.

While the economic indicators were bearish, First Republic Bank (FRC) updates supported another run at $30,000.

On Sunday, news hit the wires of US regulators attempting to avert a banking crisis by selling the beleaguered bank to a large US bank. JP Morgan Chase (JPM) was reportedly the front-runner. Overnight, news of PNC Financial Services (PNC), JPMorgan, Citizens Financial Group (CFG), and other banks submitting bids in a First Republic Bank auction eased bets on another US bank collapse.

SEC activity contributed to the late reversal, with news of the SEC fining Coinme and issuing a Cease-and-Desist weighing on investor sentiment.

The Day Ahead

It is a relatively busy Monday session. First Republic Bank (FRC)-related news will continue to influence. In the afternoon, US ISM Manufacturing PMI numbers will also draw interest.

With investors focused on the Fed monetary policy decision on Wednesday, a more marked contraction in the manufacturing sector and a fall in the prices and employment sub-components could give the FOMC doves more voice.

While investors track the First Republic Bank-related news and the stats from the US, SEC v Ripple case-related chatter and Binance and Coinbase (COIN)-related news would also move the dial. However, investors should continue to track regulatory activity and US lawmaker chatter throughout the session.

Bitcoin (BTC) Price Action

This morning, BTC was up 0.18% to $29,308. A mixed start to the day saw BTC fall to an early low of $29,249 before rising to a high of $29,346.

BTC Technical Indicators

Resistance & Support Levels

BTC needs to move through the $29,447 pivot to target the First Major Resistance Level (R1) at $29,781 and the Sunday high of $29,974. A return to $29,500 would signal an extended bullish session. The crypto news wires and US economic indicators should be crypto-friendly to support an extended rally.

In the event of an extended rally, BTC would likely test the Second Major Resistance Level (R2) at $30,308. The Third Major Resistance Level (R3) sits at $31,169.

Failure to move through the pivot would leave the First Major Support Level (S1) at $28,920 in play. However, barring a crypto event-fueled sell-off, BTC should avoid sub-$28,500. The Second Major Support Level (S2) at $28,586 should limit the downside. The Third Major Support Level (S3) sits at $27,725.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was bullish signals. BTC sat above the 50-day EMA ($28,923). The 50-day EMA pulled away from the 100-day EMA, with the 100-day EMA widening from the 200-day EMA, sending bullish signals.

A hold above the 50-day EMA ($28,923) would support a breakout from R1 ($29,781) to target R2 ($30,308) and $30,500. However, a fall through the 50-day EMA ($28,923) and S1 ($28,920) would bring the 100-day EMA ($28,807) and S2 ($28,586) into view. A fall through the 50-day EMA would send a bearish signal.