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As of today, the MACD is posting a lower reading compared to yesterday. This is typically an indication that negative momentum is decelerating, but it is still too early to tell if the trend will change, as the Relative Strength Index (RSI) is still below the signal line.
For now, bears keep dominating the price action unless the RSI says otherwise. The nearest support area for BTC in the daily chart is found in the low $90,000s. This implies a downside potential of -7.9% for the cryptocurrency.
Potential Reversal Triggers
The approval of a robust pro-crypto legislative agenda and further positive announcements on the regulatory front could be one of those positive catalysts.
Recently, the acting Chairman of the United States Securities and Exchange Commission (SEC), Mark Uyeda, announced the creation of a Crypto Task Force that will work alongside major players in the blockchain industry to draft comprehensive regulatory guidelines to help the sector thrive in the U.S.
In addition, the approval of new exchange-traded products (ETPs) for altcoins like Ripple (XRP) and Solana (SOL) could also propel the price of BTC, as it would mean a positive step forward by the SEC to bring cryptocurrency to mainstream and institutional investors.
Finally, further institutional adoption of cryptocurrencies and blockchain technology could also catalyze a major increase in the market cap of digital assets.
One clear example of this was BlackRock’s decision to set up a fund called BUIDL in partnership with Securitize to explore the potential of tokenization for the financial industry.
Recently, during a conference in Davos, the head of BlackRock, Larry Fink, commented that he could see the price of Bitcoin rising to around $700,000 if the cryptocurrency continues to be embraced by countries undergoing political turmoil as a safe haven asset.
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