Bitcoin price rises to $ 32.3K, but three factors could limit its recovery

Bitcoin price rises to $ 32.3K, but three factors could limit its recovery – Mail Bonus


Bitcoin (BTC) price action has been surprisingly good since May 27th. Weekends, especially holiday weekends, are notoriously volatile and indeterminate, with major price fluctuations being the norm. Even in the bull markets, bearish pricing is often the norm, but the BTC reversed that trend.

BTC / USD Daily Chart (Coinbase) Source: TradingView

Bitcoin rose nearly 11% between May 27 and May 30 and went through a significant $ 28,600 step to go back over $ 30,000 to $ 31,700. The weekend was the highest in the last twenty days and it gave the bulls the strongest three-day race in just over two months. However, macroeconomic fears could outweigh further growth potential.

Fears of global food shortages increase as commodity prices rise

Global food supply is a major factor that is easy to forget and contributes to the future value of Bitcoin. Since the onset of the COV-19 pandemic, governments around the world have closed their ports and airports, effectively stopping and disrupting the flow of goods. This disorder will take years to return to normal, but it is not the main cause for concern.

In the United States, fertilizer costs have risen sharply over the past 18 months. In January 2021, the fertilizer price index stood at $ 78.83 and is now at $ 254.97, rising almost + 225%. A combination of supply chain disruptions and continued shortages is likely to continue to disrupt this market.

Fertilizer Price Index Source:

Unique commodity prices continue to rise and are a major factor in a steady rise in inflation. In particular, wheat (CBOT: ZW) reached new heights in history in February 2022 and is still close to those heights of all time. In 2022 alone, the wheat future has increased by up to 76% and over 143% in the last 18 months.

Wheat futures (ZW) weekly (CBOT) Source: TradingView

Future oil contracts (NYMEX: CL) continue to rise and are now trading at levels not seen since July 2008. There is widespread concern among traders and investors that oil could rise to $ 150 a barrel by the end of China. its closure of COVID. When that happens, demand will certainly return and have a further impact on oil.

Future Crude Oil Agreements (NYMEX). Source: TradingView

Growth concerns in the stock market

Stock markets around the world are under significant pressure. Rising inflation, rising commodity costs, supply chain disruptions and the conflict in Ukraine have put investors and traders in a defensive position.

A number of significant economic events are expected to take place this week, which is likely to pause any major price changes in equities and cryptocurrencies. Information on unemployment in the European Union comes on June 1, along with the Bank of Japan’s interest rate decision and production data. In addition, US unemployment figures and the non-agricultural payroll will be published on 3 June.

In addition to a busy week, on June 3, three former US Federal Reserve residents are also scheduled to speak: John Williams and James Bullard will hold talks on June 1, and Lael Brainard on June 3.

The technical level can limit the recovery of Bitcoin to $ 37,000

Bitcoin is emerging from a new historical record with nine consecutive weekly losses. Since the beginning of the current weekly candlestick, buyers have returned and pushed BTC across the business for the past two weeks and well over 50% of the collapse of the May 9, 2022 weekly candlestick.

If Bitcoin prices can close above the daily Kijun-Sen at or above $ 31,350, then BTC has a very open way to reach the $ 37,000 range. In addition, the 2022 volume format is very thin, between $ 32,000 and $ 37,000. But $ 37,000 could be where the bulls meet the sellers again.

BTC / USD daily Ichimoku Kinko Hyo chart. Source: TradingView

If bulls want to send a message to the market that a new boom is about to begin, they will have to push Bitcoin’s daily close to $ 44,000. In that scenario, BTC would evoke an “ideal bullish Ichimoku breach” that gives bulls the means needed to retest the historical high.

While stock prices remain in bear market territory and commodities remain at an all-time high, it is at least likely that there will be a temporary turnaround. If the old adage of technology analysis, “quantity is ahead of price,” is heard again, traders should see food products and oil sales while stocks and Bitcoin rise.

The views and opinions expressed herein are those of the authors only and do not necessarily reflect the views of Every investment and trading business involves risk, you should conduct your own research when making a decision.