Within a few weeks, Bitcoin fell by $5000. Analysts were talking about $24000 as a resistance level that the Cryptocurrency could not overcome in order to continue the correction, which it has been in for the past couple of months.
During the week of August 22-28, the BTC/USDT pair traded in the $20.7-21.9 thousand dollar price range most of the time. At the beginning of the week, the focus of traders and investors was the annual economic policy symposium at Jackson Hole. They were looking forward to J. Powell’s performance at the end of the week. His speech could lead to a revision of expectations on the dynamics of the Fed’s key rate, so activity in all markets was low until Friday.
On Friday, August 26, at the end of the day, Bitcoin fell by 6.11%, to $20.2 thousand. High volatility in the market was observed closer to the opening of the American session. Before Fed Chairman Jerome Powell’s speech, the Bitcoin rate rose to $21.8 thousand. Approaching the resistance of $21.9 thousand, the price collapsed by 8%, to $20.1 thousand. The Ethereum exchange rate sank by 12.8% to $1.4 thousand from your resistance.
The Cryptocurrency turned lower amid a flight from risky assets and a recovery in the US dollar after Powell’s speech. The S&P500 fell 3.46% to 4053.65 points, the Nasdaq fell 3.94% to 12141.71 points. The dollar index (DXY) recouped the day’s losses, climbing to 108.75 points without continuing the rally.
In 2022, the basic scenario for the Cryptocurrency market in the context of Bitcoin is the preservation of a range with boundaries in the form of a June low ($17 thousand) and an August high ($25.2 thousand) with an attraction of the traded corridor of $20–22 thousand. And a pessimistic forecast, which may be associated with a new round of total risk aversion, as it was from March to June – a breakdown of $17.6 thousand and a withdrawal of $12 thousand.
The upcoming event in September, which will significantly improve the fundamental conditions of Ethereum, may lead to its growth. In the pessimistic scenario, this asset will drop to $1.2–1.4 thousand.
Learn how to earn on the bear market of Bitcoin, Ethereum, and their derivatives with Top Forex brokers
How can traders make money in the Сrypto bear market?
Short-term trading or options and CFD trading is an alternative to making money on Crypto in times of recession or volatility. In Bitcoin trading, there are several main methods. One of them is Day Trading when one buys and sells Bitcoin within one day without transferring open positions to the next day. Such transactions bring profit in small portions, but they are carried out often. As a result, at the end of the day session, the trader can receive a high level of total profit.
Swing Trading is another strategy, in which the trader uses the moments of coin correction that accompany the formation of a price trend. Just like in the previous way of earning, the task of a swing trader is to buy Bitcoin cheaper in order to then sell it more expensive.
Another way is to use option contracts, which can be a good way to hedge Crypto risks as they give you the right, but not the obligation, to trade the asset in the future at a predetermined price. With Bitcoin as the underlying asset, when a trader buys a put with a strike equal to or greater than the current price, its value will rise as Bitcoin falls. Even if Bitcoin falls, your options will rise. And, if the market moves up, which makes your option invalid, then Bitcoin will rise in price when it offsets the value of the contract.
Besides, traders can try CFDs on Cryptocurrencies, which are contracts for differences in the prices of digital assets. Regardless of the movement of the price of an asset, whether it goes up or down, you can earn money without owning, buying, or selling the Cryptocurrency itself. The main thing is to choose a regulated trusted Forex broker that we compare on TopForex.trade, everything else is a matter of your tactics.
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