Bitcoin (BTC) saw fresh volatility after July’s final Wall Street open as highs north of $24,000 remained solid resistance.
BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView
Resistance strikes BTC at $24,000
The pair had attempted to match the week’s local top of $24,450, this ultimately failing to materialize as a resurgent U.S. dollar pressured crypto despite the gains of U.S. stocks .
The U.S. dollar index (DXY) continued higher during the Wall Street trading, passing 106 after falling to its lowest levels since July 5.
U.S. dollar index (DXY) 1-hour candle chart. Source: TradingView
Record eurozone inflation added to the mix of macro triggers on the day, while the monthly close remained a guessing game for Bitcoin analysts.
On short timeframes, popular trader Crypto Tony eyed what he called a “classic short setup” around the high, which remained Bitcoin’s best since mid-June.
A classic short setup with a clear invalidation point ..
Did anyone catch it pic.twitter.com/DTW2rAYM9K
— Crypto Tony (@CryptoTony__) July 29, 2022
Nonetheless, other key levels remained apt to act as support in the event of a deeper drawdown. These included Bitcoin’s 200-week moving average at around $22,800 and realized price at $21,820.
— PlanB (@100trillionUSD) July 29, 2022
In terms of the former, however, Bitcoin’s weekly candle would need to close for confirmation of a resistance/support flip, fellow trader and analyst Rekt Capital noted on the day.
The weekly close would also act as the monthly close, making July 31 a key psychological day of reckoning after June’s 40% drawdown — Bitcoin’s worst monthly performance since September 2011, figures from on-chain data resource Coinglass confirmed.
Bitcoin monthly returns chart (screenshot). Source: Coinglass
180 days until “full recovery”?
Summing up 2022 for crypto markets so far, meanwhile, a new report from on-chain analytics firm Glassnode and markets site CoinMarketCap hinted at how long the road to recovery could be.
After the mayhem, which began with the Terra (LUNA) — now renamed Terra Classic (LUNC) — collapse in May, a “resetting” had occurred throughout crypto assets, the report argued.
With Bitcoin and Ether (ETH) alone down 75% from all-time highs in under a year, it may not be until 2023 that the trend can change definitively.
“The market has only been in this position since mid-June, and previous bear cycles have taken an average of 180-days before full scale recovery was in effect,” it read.
“All in all, 2022 has thus far been a major resetting of market expectations, a wide ranging de-leveraging, and ideally, the start of a new set of foundations, upon which even taller structures may be built,”
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