Bitcoin price is playing catch-up, why $28,000 is a key level

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Bitcoin price is finally recording profits, but it looks weak compared to other crypto assets. The macroeconomic environment is waking up, disrupting all asset classes.

As of this writing, Bitcoin price is trading at $16,800 with sideways movement in the past 24 hours. In the top 10 cryptos, BTC lags behind Ethereum, Binance Coin, and Cardano. These cryptocurrencies react positively at the beginning of 2023.

The price of BTC is moving sideways on the daily chart. Source: BTCUSDT TradingviewBitcoin Price Eyes Higher Levels

According to a recent report from trading desk QCP Capital, institutions are returning to action and allocating capital to gold and other assets. The precious metal has been up 15% in the past 60 days and continues to rise.

The trading desk believes that institutions fall into “alternative assets” or stores of value. Bitcoin price has yet to take advantage of this trend, but the crypto market is seeing some profits. In particular, the non-fungible token space.

This sector is coming back to life after months of declining activity. Popular NFT collections recorded 2-3x profits at the end of 2022 and are expected to continue the trend. QCP Capital noted the price action of Bitcoin and Ethereum:

() in line with gold and NFTs, BTC and ETH are catching up to some extent with the start of the year. Despite the mini rally, BTC is still trading in an extremely tight falling wedge – with 18,000 the key breakout level to the top.

If Bitcoin price can swing from $18,000 and trend higher through institutional allocation to alternative assets, the cryptocurrency could recover to higher levels. The trading desk indicates $28,000 as a critical level to watch.

This level is the neckline of the “Head and Shoulders” pattern formed by BTC over the past two years. Additionally, $28,000 is confluent with the 61.8% Fibonacci retracement level, which means that many players will be keeping an eye on it.

$28,000 for BTC confluences with key levels. Source: QCP Capital via TwitterWhat could be a hurdle for Bitcoin

In the short term, the price of Bitcoin is seeing resistance at its current levels. Analyst Caleb Franzen says BTC should continue to see resistance around these prices and higher.

BTC price enters major resistance Source: Caleb Franzen via Twitter

In 2022, the $17,000 levels worked as critical support. Once lost, these levels turned into significant resistance, likely creating friction for the cryptocurrency. As the analyst pointed out, Bitcoin has already been rejected from these levels in an attempt to rally past the $18,000 mark. Franzen said:

Bitcoin is firmly in a potential resistance range. Even if price manages to break above this diagonal resistance channel, we cannot ignore the overhead resistance of the former 2022 support range. We have already been rejected there once…

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