Bitcoin dropped more than 18% in December and ended 2021 at $46,206.50, far below the psychological figure of $100,000 that many analysts had been projecting. Bobby Lee, former CEO of the BTCC exchange, pointed out in early December that Chinese crypto exchanges like Huobi and OKEx had until December 31 to “fully de-register their Chinese clients & force withdraw coins”. This could have aggravated selling in the last few days of 2021 and kept bitcoin prices under check.

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Economist and trader Alex Krüger is bullish for the New Year. He pointed out in a tweet that bitcoin has rallied between 7% and 36% in the first week of January in the past four consecutive years.

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Arcane Research,  a blockchain research company, in its 2021 Summary, said that if the S&P 500 continues its bull move in 2022, bitcoin is likely to outperform it. However, if the stock market enters a bear phase, then “bitcoin will likely underperform”.

Amid the uncertainty for 2022, MicroStrategy remains bullish as it continues to accumulate bitcoin on the dips. Its recent 8-k filing shows that the data analytics company “purchased approximately 1,914 bitcoins for approximately $94.2 million in cash, at an average price of approximately $49,229 per bitcoin, inclusive of fees and expenses”. The latest purchase boosted the company’s total haul to 124,391 bitcoins, bought at an average price of about $30,159 a coin, inclusive of fees and expenses.

Could crypto markets turn bullish in 2022? Will bitcoin go up? Read our BTC price analysis to find out. 

Bitcoin price technical analysis: weekly chart

BTC’s price once again turned down from the 20-week exponential moving average (EMA) last week, indicating that bears continue to defend this level aggressively. The BTC/USD pair dropped 6.89% to end the week at $47,293.10.

The fall has pulled the price back below the 50-week simple moving average (SMA) and the bears will now try to sink the pair below $42,827.90. If they succeed, it will suggest the resumption of the move down.

The pair could drop to $39,565.25. If that support also cracks, the decline may extend to $30,000. 

This negative view will be invalidated if the price turns up from current level and breaks above the 20-week EMA. Such a move could trap the aggressive bears, resulting in a short squeeze.

The pair could first rally to $60,000. If bulls overcome this barrier, the next stop could be a retest of the all-time high at $69,055. The bitcoin price analysis shows that bears continue to sell at higher levels. 

Bitcoin price technical analysis: daily chart

BTC’s price dipped back below the 20-day EMA on 28 December, suggesting a lack of demand at higher levels. Both moving averages are sloping down and the relative strength index (RSI) is in the negative zone, indicating that the path of least resistance is to the downside.

If bears sink the price below $45,462.90, the selling could intensify and the pair could drop to the critical level at $42,827.90.

Contrary to this assumption, if the price rebounds off $45,462.90, the bulls will again try to start a recovery. A break and close above the 20-day EMA could open the doors for a possible rally to $52,122.15. 

This is an important resistance for the bears to defend because a break and close above it could signal that the correction may be ending. The pair could then rise toward $60,000.

Bitcoin: buy or sell at current levels?

The bitcoin price analysis suggests that bears have the upper hand. The selling pressure could increase on a break and close below $45,462.90. The bulls will have to push and sustain the price above $52,122.15 to signal a trend change.

The views and opinions expressed in the article are those of the author and do not constitute trading advice. Trading and investing involve substantial risks and you should do your own research or contact your financial adviser before arriving at a decision. 

Further Reading: Bitcoin vs Bitcoin Cash vs Bitcoin SV: The ultimate guide

Further Reading: Physical bitcoins: What’s the deal?