Bitcoin is trading sideways in the $6,800 price range. The world’s largest cryptocurrency entered the week looking weak. On Monday, Bitcoin dropped to test the $6,600 support before bouncing back. This was triggered by a huge dump starting on Sunday when the coin was trading in the highs of $7,100. Luckily, Monday’s drop did not see the coin fall below $6,500, one of a number of critical supports.
Since Bitcoin climbed to the $6,800 range there has been a battle over control of the market. The bulls want to see Bitcoin climb back above $7K. Bears, on the other hand, are looking to breach the $6.5K support and test the $6K support before Bitcoin can get back to recent resistances.
The daily trading volume shows that there is little enthusiasm among investors. At the time of writing this, the volume is just above $34 Billion. The lack of participation by bulls; buying, could be a negative signal with bears encouraged to take up dominance. If bulls do not pick up momentum, we could see the bears dragging prices down to test the $6.5K support.
On the upside, if the bulls show up, the target will be in the highs of $7,800.
The key catalyst which is now in the midterm is the Bitcoin halving. While there has been a great debate on whether this event will trigger a pump, it remains a significant historic event. In the past, it has seen huge gains heading and coming out of it and a lot of investors expect the same to repeat.
Another hugely debated catalyst is the U.S household cheques. On Monday, the Treasury announced that 80 million households will receive their cheques as early as this week. Some analysts and investors expect that some of the money being sent by the government will make way to the crypto market.
The next few days will be critical as it sets investor sentiment heading to the halving. Although it is nearly guaranteed that Bitcoin will rally during the halving, if sentiments are bearish, the rally could falter. while if bullish, prices could moon.