Bitcoin to Sub-$20,000 Next? Here’s What Options Markets Say About the BTC Price Outlook

cryptonews.com:

Cryptocurrency markets have slipped on Tuesday in tandem with US stock prices as US yields and the US dollar rise in wake of hawkish commentary from US Federal Reserve Chairman Jerome Powell at the first day of his semi-annual testimony before the US Congress on Tuesday.

Powell warned that the Fed could lift interest rates higher and at a faster pace than previously signalled. Analysts interpreted Powell’s remarks as an opening of the door to a possible 50 bps rate hike at this month’s policy meeting.

Bitcoin was last trading just above $22,000 following its first dip beneath that level since mid-February earlier in the session and was last down about 1.5% on the day. Technicians pointed out that Tuesday’s drop means Bitcoin has now broken below an uptrend that had been in play since mid-January, opening the door to a potential retest of February’s lows in the $23,000s and perhaps even the 18th January low in the $20,300s.

Certainly, the 14-Day Relative Strength Index (RSI) suggests that there is plenty of room further downside before Bitcoin reaches a point of being oversold. Bitcoin’s RSI was last around 40, with a score below 30 seen as signifying that market conditions have become overly bearish.

Some bears think that a retest of Bitcoin’s 200-Day Moving Average and Realized Price (the average price at which each Bitcoin last moved on the blockchain) in the $19,700-800 region is a possibility. Crypto futures traders certainly seem to have turned more bearish, with the futures margin funding rates having turned negative in recent days to a degree not seen since early January.

US interest rates rising higher and at a faster pace than previously signaled, as Powell warned was a possibility, depends upon how hot upcoming US