BTC has been capped at 78,000 with the 50-period H4 EMA also rejecting bounces, and continuation lower stays the base case with $74k as the natural objective ahead of next week's PCE and GDP prints.
🔴 May 22, 9:04am ET
Yesterday was capped by resting sell orders at 78,000 and above, while 77,000 has held so far on the multi-day pullback from the 82s.
Continuation lower stays the base case until the 78,000 cap breaks and reclaims the upper part of the range.
After the rejection from 82,000 late last week, price pulled back and found support just above 76,000.
The bounce stalled at the 50-period H4 EMA, which is capping every attempt higher and setting up either a reclaim or another flush of 76,000.
Monday's low at 76,000 is the month's low and a long liquidation magnet, so a sweep looks likely at minimum.
Below sits the yearly VWAP at 74,800, with the next major liquidation magnet at 74,000 just below it as the natural objective on continuation.
May's value area low continues to cap price on every attempt to reclaim the range.
Beneath that, price is consolidating at April's point of control, the line between holding April's value area and rolling toward its low.
Above 78,000, a short liquidation zone and resting sell orders are absorbing each breakout attempt.
Below, the order book is thinner: the long liquidation cluster starts at 76,000, and a sweep to 74,000 would wipe out most of the leveraged long positioning.
Uncertainty is rising as Warsh is sworn in to the Fed today.
Initially viewed as aligned with a dovish base case, the backdrop of inflation and warning signs from the bond market suggest rate hikes could be more likely than previously considered.
Core PCE and Q1 GDP land on May 28, the first meaningful read on the stagflation scenario many expect.
The combined print will define whether high inflation and slowing growth are converging or one side gives way.
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The defining question for the New York session is whether 76,000 holds against the inevitable retest, or whether the multi-day pullback from the 82s extends through the long liquidation cluster and toward the $74k magnet that sits in confluence with the yearly VWAP at 74,800.
Asia and London ran a quiet consolidation beneath the 50-period H4 EMA, which has capped every attempt higher since yesterday's bounce. The order book remains asymmetric: resting asks and a short liquidation zone absorbing every push above 78,000, while the support side is thin with the long liquidation cluster beginning at 76,000.
The cleanest tactical read: a reclaim of 78,000 with break of the EMA cap invalidates the continuation thesis; a flush through 76,000 opens the chained move toward 74,800 and 74,000, the natural objective ahead of next week's PCE and GDP prints...