21.02.202209:06 Forex Analysis & Reviews: Crypto market update for February 21, 2022

Bitcoin has dropped $6,000 over the past four days. Thus, I have every reason to assume that the formation of the upward wave is completed. If this is true, then at this time the construction of a new downward wave has begun, the targets of which may be located near $27,500. If the cryptocurrency manages to reach this mark, this will be the minimum value of its value since December 2020. From my point of view, this target looks quite realistic. The current wave picture looks quite convincing, and the news background now does not allow us to expect an upward set.

The situation in Donbass has not improved over the weekend. The regime of silence is not respected, battles are being fought along the entire border of the LPR and the DPR. World leaders make statements almost every day, but their essence does not change from day to day. The West and Europe continue to insist that the Russian Federation withdraw its troops from the Ukrainian borders and believe that a full-fledged invasion will begin today or tomorrow. Moscow continues to say that it is conducting joint exercises with Belarus and deploying its troops on its territory wherever it wants. The situation is tense to the limit and can "shoot" at any moment.

And again, geopolitics

How exactly the cryptocurrency market is going to react to any escalation of the conflict, it already showed last week. As soon as the news began to arrive that the West and Russia could not come to a consensus, the demand for bitcoin immediately began to decline sharply. Each subsequent news only led to a new drop in demand. At this time, the civilian population of the DPR and LPR is being evacuated to the Russian Federation, and men are being drafted into the army. It is hardly possible to interpret such messages as a de-escalation of the conflict. Nevertheless, bitcoin, the markets, and you and I continue to believe in the diplomatic resolution of all controversial issues.

The market is negative

Many analysts now also agree that market sentiment is negative. How the geopolitical conflict between Ukraine and the Russian Federation will end is unknown, and in less than a month, the Fed will raise interest rates for the first time in a long time. For bitcoin, these are extremely negative factors. Analysts expect Bitcoin to drop to $34,000 before the next Fed meeting. I think it will go lower as it is already at $38,000. And the whole future of the cryptocurrency market now revolves around these two factors. Under these circumstances, I don't see the point in even quoting the many experts and investors who share their predictions for the price of bitcoin in a few months or a year. Now is a time of crisis and investors are afraid of the fall of risky markets. Therefore, the bullish mood is now at zero.

The construction of the downward trend section continues. At this time, the current wave counting takes on a five-wave form and can continue its construction with targets located near $29,117 and $26,991, which equates to 0.0% and 61.8% Fibonacci within wave e. A successful attempt to break through the $41,470 mark, which corresponds to 38.2% Fibonacci, indicates the market is ready for further sales. Thus, I expect another downward wave to be built. Considering what a difficult news background is now, this wave can be very long.

In many ways, everything will depend on how long the escalation of the conflict in Ukraine will last and how far everything will go. In the coming weeks, everything will really depend on geopolitics, and on March 15-16, the Fed will raise the rate. It's hard to come up with a worse news background for bitcoin.