BTC Bulls to Retarget $27,000 Despite Ever Increasing Headwinds

Key Insights:

• On Sunday, BTC ended a three-day winning streak, falling 0.67% to end the day at $26,358.
• A quiet Sunday session left profit-taking to leave BTC in the red as investors consider the likely impact of SEC activity on the digital asset space.
• However, the technical indicators remained bullish, signaling a return to $27,000.

On Sunday, bitcoin (BTC) declined by 0.67%. Reversing a 0.67% gain from Saturday, BTC ended the week up 1.56% to $26,358. Significantly, BTC ended a three-day winning streak while avoiding sub-$26,000 for a second consecutive session.

After a mixed start to the day, BTC rose to a late-session high of $26,729. However, falling short of the First Major Resistance Level (R1) at $26,861, BTC fell to a low of $26,276. Steering clear of the First Major Support Level (S1) at $26,276, BTC found late support to end the session at $26,358.

SEC v Binance and SEC v Ripple Uncertainty Weighed

It was a quiet Sunday session, with no crypto events to influence investor sentiment. The lack of crypto events left investors to lock in profits ahead of another busy week for the crypto market.

Investor angst over the ongoing SEC v Ripple case and the SEC move against Binance left BTC on the back foot.

Hawkish Fed chatter and rising bets of interest rate hikes in September were also bearish.

According to the CME FedWatch Tool, the probability of a 25-basis point July rate hike stood at 74.4%, up from 52.8% one week earlier. Significantly, the chances of a September 25-basis point interest rate hike rose from 50.0% to 67.1% over the week, while bets on a 50-basis point interest rate hike fell from 15.7% to 11.2%.

The Day Ahead

It is a quiet Monday session, with the US markets closed for Juneteenth Day. A lack of US economic indicators will leave Fed chatter and the crypto news wires to provide direction.

The SEC cases against Ripple, Binance, and Coinbase (COIN) remain the focal points, with case-related chatter likely to move the dial. However, investors should track lawmaker commentary and references to the latest SEC moves against the digital asset space.

Bitcoin (BTC) Price Action

This morning, BTC was up 0.13% to $26,391. A mixed start to the day saw BTC fall to an early low of $26,345 before rising to a high of $26,405.

BTC Technical Indicators

Looking at the EMAs and the 4-hourly candlestick chart (below), the EMAs sent bullish signals. BTC sat above the 100-day EMA ($26,298). The 50-day EMA closed in on the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA, sending bullish signals.

A move through R1 ($26,633) and the 200-day EMA ($26,647) would support a breakout from R2 ($26,907) to target $27,000. However, a fall through the 100-day EMA ($26,298) would bring S1 ($26,180) and the 50-day EMA ($26,158) into view. A fall through the 50-day EMA would send a bearish signal.

Resistance & Support Levels

BTC needs to move through the $26,454 pivot to target the First Major Resistance Level (R1) at $26,633 and the Sunday high of $26,729. A return to $26,500 would signal an extended bullish session. The crypto news wires 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 $26,907 and resistance at $27,000. The Third Major Resistance Level (R3) sits at $27,360.

Failure to move through the pivot would leave the First Major Support Level (S1) at $26,180 in play. However, barring a risk-off-fueled sell-off, BTC should avoid sub-$26,000. The Second Major Support Level (S2) at $26,001 should limit the downside. The Third Major Support Level (S3) sits at $25,548.