Bitcoin (BTC) bounced off $40,000 on Tuesday as attention returned to United States regulators.
BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView
$45,000 target emerges for bulls
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD circling $43,000 Tuesday ahead of fresh comments from Gary Gensler, chair of the Securities and Exchange Commission.
BTC price action steadied on the day after a fresh dip saw the first test of $40,000 support since Aug. 6.
While traders remained cautiously bullish on the outlook, the shadow of Evergrande, put off by a public holiday in China, still loomed large over sentiment.
“I am not too euphoric about this bounce,” popular trader Crypto Bullet summarized as part of his latest update.
“Surely it’s nice to see some strength by Bitcoin but over all it still looks bearish to me.”
He added that a $46,500 reclaim would be a deal-breaker to return to a bullish perspective, a requirement echoed elsewhere.
“Reclaiming 45k as support is bullish objective,” Filbfilb, an analyst at trading platform Decentrader, told subscribers of his Telegram channel on the day.
Meanwhile, Tuesday evening was scheduled to see Gensler, already in the spotlight over his comments on stablecoins, cement his position on cryptocurrency in an interview with The Washington Post.
Never mind the exchange reserves?
On the topic of China, analysts were adopting a longer-term approach, arguing that events such as the potential implosion of Evergrande were exactly the reason Bitcoin was created.
“Gentle reminder that BTC typically sells off in near term with global macro uncertainties...but the major issues brewing around the world right now are exactly what Bitcoin was built to protect us against,” fellow Decentrader analyst Philip Swift wrote this week.
Historical precedent buoyed the bull cause, with others noting that March 2020 delivered a springboard for new Bitcoin all-time highs after the initial collapse to $3,600.
As such, concerns such as exchange reserves rising on major exchange Binance were less of an issue.
“Yes, Binance’s BTC balance is increasing, suggesting selling from China. However, for context, this has been a several-week-long trend and overall exchange flows remain neutral over the last few days,” analyst William Clemente said as part of comments on the phenomenon.
Bitcoin exchange reserves comparative chart. Source: William Clemente/Twitter