Bitcoin 

BTC

$16,933

 starts a new week in a precarious place as global macro instability dictates the mood.

After sealing a weekly close just inches above $19,000, the largest cryptocurrency still lacks direction as nerves heighten over the resilience of the global financial system.

Last week proved a testing time for risk asset investors, with gloomy economic data flowing from the United States and, moreover, Europe.

The eurozone thus provides the backdrop to the latest concerns of market participants, who are watching as the financial buoyancy of major banks is called into question.

With the war in Ukraine only escalating and winter approaching, it is perhaps understandable that hardly anyone is optimistic — what could the impact be on Bitcoin and crypto?

BTC/USD remains below its prior halving cycle’s all-time high, and as comparisons to the 2018 bear market flow in, so too is talk of a new multi-year low.

Cointelegraph takes a look at five BTC price factors to watch in the coming days, with Bitcoin still firmly below $20,000.

Spot price avoids multi-year low weekly close

Despite the bearish mood, Bitcoin’s weekly close could have been worse — at just above $19,000, the largest cryptocurrency managed to add a modest $250 to last week’s closing price, data from Cointelegraph Markets Pro and TradingView shows.

That prior close had nonetheless been the lowest since November 2020 on weekly timeframes, and as such, traders continue to fear that the worst is yet to come.

“The bears remained in full swing last night during the Asian, while the bulls failed to give us any good rallies to work off on,” popular trader Crypto Tony wrote in part of a Twitter update on the day.

Others agreed with a summary that concluded that BTC/USD was in a “low volatility” zone, which would necessitate a breakout sooner or later. All that was left was to decide on the direction.

“Next big move is up,” Credible Crypto responded:

“Typically prior to these major moves and after capitulation we see a period of low volatility before the next big move begins.”

As Cointelegraph reported, the weekend was already tipped to provide a boost of volatility as suggested by Bollinger Bands data. This came hand in hand with rising volume, a key ingredient in sustaining a potential move.

“Weekly chart BTC shows a massive increased volume since the beginning of the third quarter + weekly bullish divergence on one of the most reliable time frames,” fellow trading account Doctor Profit concluded:

“Bitcoin price increase is just a matter of time.”

Not everyone eyed an impending comeback, however. In predictions over the weekend, meanwhile, trader Il Capo of Crypto gave the area between $14,000 and $16,000 as a longer-term target.

“If this was the real bottom... bitcoin should be trading close to 25k- 26k by now,” trading account Profit Blue argued, showing a chart with a double bottom structure potentially in the making on the 2-day chart.

Credit Suisse unnerves as dollar strength goes nowhere

Beyond crypto, attention is coalescing around the fate of major global banks, in particular Credit Suisse and Deutsche Bank.

Worries over liquidity resulted in emergency public reassurances from the CEO of the former, with executives reportedly spending the weekend calming major investors.

Bank failures are a sore spot for underwater hodlers — it was government bailouts of lenders in 2008 which originally spawned Bitcoin’s creation.

With history increasingly looking to rhyme nearly fifteen years later, the Credit Suisse saga is not going unnoticed.

“We can’t see inside CeFi firm Credit Suisse  JUST LIKE we could not see inside of CeFi firms Celsius, 3AC, etc.,” entrepreneur Mark Jeffery tweeted on the day, comparing the situation to the crypto fund meltdowns earlier this year.

For Samson Mow, CEO of Bitcoin startup JAN3, the current environment could yet give Bitcoin its time to shine in a crisis instead of staying correlated to other risk assets.

“Bitcoin price is already pushed down to the limit, well below 200 WMA,” he argued, referring to the 200-week moving average long lost as bear market support.

“We’ve had contagion from UST/3AC and leverage flushed already. BTC is massively shorted as a hedge. Even if Credit Suisse / Deutsche Bank collapse & trigger a financial crisis, can’t see us going much lower.”

Nonetheless, with instability already rampant throughout the global economy and geopolitical tensions only increasing, Bitcoin markets are voting with their feet.

The U.S. dollar index (DXY), still just three points off its latest twenty-year highs, continues to circle around for a potential rematch after limiting corrective moves in recent days.

Looking further out, macroeconomist Henrik Zeberg repeated a theory that sees DXY temporarily losing ground in a major boost for equities. This, however, would not last.

“In early 2023 DXY will once again rally with target of ~120. This will be Deflationary Bust - and Equities will crash in a larger bust than during 2007-09,” he wrote in part of a tweet:

“Largest Deflationary Bust since 1929.”

Miner revenue measure nears all-time low

With Bitcoin price suppression grinding on, it is less than surprising to see miners struggle to maintain profitability.

At one point in September, monthly selling from miners was in excess of 8,500 BTC, and while this number subsequently cooled, data shows that for many, the situation is precarious.

“Bitcoin miner revenue per TeraHash on the edge of all time lows,” Dylan LeClair, senior analyst at digital asset fund UTXO Management, revealed at the weekend:

“Margin squeeze.”

The scenario is an interesting one for the mining ecosystem, which currently deploys more hash rate than at almost any time in history.

Estimates from monitoring resource MiningPoolStats put the current Bitcoin network hash rate at 261 exahashes per second (EH/s), only marginally below the all-time high of 298 EH/s seen in September.

Competition among miners also remains healthy, as evidenced by difficulty adjustments. While seeing its first decrease since July last week, difficulty is set to add an estimated 3.7% in seven days’ time, taking it to new all-time highs of its own.

Nonetheless, for economist, trader and entrepreneur Alex Krueger, it may yet be premature to breathe a sigh of relief.

“Bitcoin hash rate hitting all time highs while price goes down is a recipe for disaster rather than a cause for celebration,” he wrote in a thread about the miner data last month:

“As miner profitability gets squeezed, odds of another round of miner capitulation increase in the event of a downmove. But hopium never dies.”

GBTC “discount” hits new all-time low

Echoing the institutional exodus from BTC exposure this year, the space’s largest institutional investment vehicle has never been such a bargain.

The Grayscale Bitcoin Trust (GBTC), which in the good times traded far above the Bitcoin spot price, is now being offered at its biggest-ever discount to BTC/USD.

According to data from Coinglass, on Sep. 30, the GBTC “Premium” — now, in fact, a discount — hit -36.38%, implying a BTC price of just $11,330.

The Premium has now been negative since February 2021.

Analyzing the data, Venturefounder, a contributor to on-chain analytics platform CryptoQuant, described the GBTC drop as “absolutely wild.”

“Yet still no sign of GBTC discount bottoming or reversing,” he commented:

“Institutions are not even biting for $12K BTC (locked for 6 months).”

Cointelegraph has long tracked GBTC, with owner Grayscale attempting to get legal permission to convert and launch it as a spot exchange-traded fund (ETF) — something still forbidden by U.S. regulators.

For the meantime, however, the lack of institutional appetite for BTC exposure is something of an elephant in the room.

“Objectively, I would say there isn’t much interest in $BTC from U.S. based institutional investors until $GBTC starts getting bid closer to net asset value,” LeClair wrote last week.

Charting Bitcoin’s “max pain” scenario

While it is safe to say that a fresh Bitcoin price drop would cause many a hodler to question their investment strategy, it remains to be seen whether this bear market will copy those which have gone before.

Related: Analyst on $17.6K BTC price bottom: Bitcoin 'not there yet'

For analyst and statistician Willy Woo, creator of data resource Woobull, the next bottom could have a close relationship with hodler capitulation.

Previously in Bitcoin’s history, bear market bottoms were accompanied by at least 60% of the BTC supply being traded at a loss.

So far, the market has almost, but not quite, copied that trend, leading Woo to conclude that “max pain” may still be around the corner.

“This is one way of visualising maximum pain,” he wrote alongside one of his charts showing underwater supply:

“Past cycles bottomed when approx 60% of the coins traded below their purchase price. Will we hit this again? I don’t know. The structure of this current market this time around is very different.”

According to on-chain analytics firm Glassnode, as of Oct. 2, 9.52 million BTC was being held at a loss. Last month, the metric in BTC terms hit its highest since March 2020.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.