BTC hovers near $17K as analyst identifies area of ‘real max pain’

Bitcoin (BTC/USD) remains poised near the $17,000 area as the cryptocurrency market looks to channel positive sentiment in a historically bullish December for the markets.

But even then, crypto news is largely negative at the moment. And if the contagion hitting the sector continues to impact prices and restricting the benchmark asset to sideways price action, it could result in real maximum pain for traders.

Bitcoin’s area of ‘real max pain’

According to one analyst, it’s possible BTC price will continue to fluctuate around current levels for months. The pseudonymous crypto trader and analyst Mags said in a tweeted forecast on Monday that while people might expect further declines to the $10,000-$14,000 range, this would not be the area of maximum pain for traders.

In his opinion, Mags sees Bitcoin held in a tight $500 range well into 2023 as the “real max pain,” noting that people are largely prepared for potential leg downs to the $14,000-$10,000 zone.

But Bitcoin stuck in a small range would see most traders look to take whatever profits they manage – essentially “over-trading ±2% flat range.” The technical analyst sees this scenario as one likely eat into most people’s capital as an area of real maximum pain.

Mags tweeted:

“$10k – $14k won’t be Max pain for majority because most of you are prepared for it! The real max pain is price moving inside a $500 range for months. Most of the people will end up eroding large portion of their capital by over-trading a ±2% flat Range.”

Bitcoin price and the stock market

Bitcoin plunged below $16,000 in early November as crypto exchange FTX imploded, and again touched prices towards $15,600 later in the months amid broader industry contagion.

The tumultuous year that’s been 2022 still has a few weeks to go and it wouldn’t be surprising to see the cryptocurrency mirror action across stocks. A look at the equities market suggest that Wall Street is primed for its worst yearly return since 2008.

As Invezz highlighted this morning, key monetary policy decisions this week are from four major central banks – including the US Federal Reserve, the European Central Bank and Bank of England. Decisions and investor reaction around the events could dictate sentiment ahead of the yearly close.

The post BTC hovers near $17K as analyst identifies area of ‘real max pain’ appeared first on Invezz.