Bitcoin, which had not been able to finish a single trading day at a price of more than $17,000 since mid-December; Last night, it was able to close the weekly candle at the level of $17,163, so that a wave of optimism (albeit temporary) returns to the crypto market. Some believe that this is the beginning of an upward trend that can bring the price of Bitcoin to $18,000, and some analysts have gone as far as to say that the bottom of the market is possible. However, there are signs that strongly contradict these optimistic claims.
According to Mihan Blockchain and quoted by CoinDesk, Bitcoin managed to reach the price of $17,000 on Sunday and crossed its recent price range and recorded the highest price in the last three weeks. On Friday, the price of Bitcoin entered the $17,000 channel after the release of information that US service businesses were in a downward trend.
Traders in traditional and cryptocurrency markets are taking the downward trend in service businesses as a sign that the Federal Reserve may soon ease its tightening measures on economic conditions. But it took a few days for Bitcoin to break through the price ceiling it has held since mid-December.
Analysts have noted that the price charts are still bearish, although Coinbase’s David Duong wrote in his report that a successful break above $17,100 could put the cryptocurrency on its way to a technical level. Next place on $17,800. Of course, as mentioned in the previous article of Blockchain Homeland, in order to target higher price levels, Bitcoin must first overcome the resistance of $17,300.
According to Fundstart’s Sean Farrell, blockchain data shows that there are a lot of buyers eager to buy Bitcoin at the $16,000-$17,200 price level. Ferrell wrote in his report:
This creates a very strong buying wall at the current price level. This shows that a solid price floor is forming.
In the coming week, Bitcoin traders will be looking at the important US inflation report. The December CPI report will be announced on January 12 (January 22), and the Federal Reserve will decide on the interest rate hike on January 31 (February 11). The contractionary monetary policies of the Federal Reserve in 2022 are considered to be one of the most important factors in the collapse of all markets and the 64% decrease in the price of Bitcoin this year, which marked the worst performance of this cryptocurrency in the last four years.
Cryptocurrency market traders are still monitoring news about the future of Digital Currency Group (DCG) and its subsidiary, Genesis. If Genesis (or its parent company DCG) declares bankruptcy, it is possible to face a sharp fall in the market and the positive momentum formed in the market will be lost.
- Will the upward trend in the price of Bitcoin continue?
If the market remains calm and there is no bad news from Genesis and DCG and the release of positive statistics on December inflation on Thursday, it is possible that the upward trend in the price of Bitcoin will continue; But first it has to overcome the stubborn resistance at the $17,300 level.
- Have we passed the price floor of Bitcoin?
Considering the significant price growth of some altcoins such as Gala, Lido, Solana and Cardano, which is a sign of high leverage in the market, and considering the unfavorable macroeconomic conditions in 2023 and the possibility of a recession, it seems to get excited about the market situation. The right time has not yet come.