I don't like the look of the bitcoin chart... and when you're trading crypto there isn't much else to go on.
There was a weeks-long period of consolidation around $23,000 in an impressive rally from $17,000 but there was a false breakout to $24,000 and yesterday it broke below the range. The selling has continued today, albeit at a modest pace. It's down another $180 to $21,650.
The bulls will be hoping that the mid-January highs now act as support and that idea has some traction today as it flattens out. Like all markets, bitcoin will be watching Wednesday's US CPI report and hoping for good news on the inflation front. If prices are high enough to convince the market that 5.50% Fed funds are coming then expect another selloff that pressures the $20,500 to $20,000 zone. That will need to hold or we will see another day like yesterday.
As for broader markets, the weakness in bitcoin has been a forerunner for risk aversion in the past, especially in tech stocks. There's also a three-candle reversal in TSLA brewing after a 100% climb from the bottom.
