Bitcoin (BTC) is currently moving above the recently breached $74,000 resistance, positioning it to recapture price levels not seen since the fourth quarter of last year. However, this week’s activity will be turbulent, as market expert Virtual Bacon predicts that it could be “Bitcoin’s most volatile week of the year.”
Bear Market Wins
In a report shared on the social media platform X, Virtual Bacon noted that, although the current price level of Bitcoin is optimistic, important challenges remain.
The 200-day moving average (SMA) sits at $93,000, while the 50-week SMA is around $98,000. The last high-low resistance was paid at $94,000, which creates a confluence of resistance in the $93,000 to $98,000 range.
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Simply put, there is a 15 percent risk of support levels at the $60,000 low, compared to a 30 percent potential resistance. Virtual Bacon emphasized that the chances of a rejection back to the previous range outweigh the chances of a complete breakout bull market.
“This is not my fault,” he said, stressing that the analysis is based on facts and figures. “We remain in a bear market until BTC breaks above the $94,000 to $98,000 resistance.”
Market Volatility Expected This Week
Virtual Bacon’s concern about the expected volatility this week is due to several reasons for the volatility. The first is the meeting of the Federal Open Market Committee (FOMC) which will be held on March 18-19.
There is a 99.1% chance of no interest cut rate. However, the expert believes that any comments from Federal Reserve Chairman Jerome Powell—especially regarding a hawkish stance on oil-driven inflation—could cause a sharp market selloff.
In addition, the expiration of a quarter of Bitcoin options on the same day enhances the potential for dramatic market movements. Current options data shows large open interest consolidating in the $74,000 to $75,000 range, suggesting that prices may remain stuck near this level until the end of Friday’s session.
Virtual Bacon noted that, if the price of Bitcoin goes above $75,000, it could rise to $80,000. However, if it falls below $70,000, it may increase the bearish trend.
What’s going on political differences The surrounding oil prices may further complicate market conditions. The expert argued that if oil prices approach $120, combined with the FOMC and quadruple witching events, the market could experience significant volatility.
Two states of Bitcoin
From the expert’s point of view, there are two important situations to consider at the end of the week. The first, a potential breakout, will see Bitcoin hold above the $75,000 mark through the expected Friday to waver.
He said this could facilitate a move to $80,000 and set the stage for a bullish revival as the market looks to recover from key resistance levels of $94,000 to $98,000 in the second half of the year.
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The second scenario involves a rejection at the $75,000 resistance level, leading to a decline in expiration back to the $63,000 to $70,000 range.
Virtual Bacon concludes that if such a decline occurs, the S&P 500 could break below its 200-day SMA, and oil prices could rise, pushing Bitcoin back into long-term bear market conditions, with conditions suggesting prices could drop to $58,000 or even $43,000.
Featured image from OpenArt, chart from TradingView.com
