Bitcoin BTC/USD rally that kick started beginning of the new year has strengthened, thanks to a general increase in risk-taking ability.
What happened: Bitcoin on Saturday broke the psychological threshold of $23,000 intraday for the first time since mid-August 2022. Benzinga Pro Data.
After hitting a low of $15,599.05 on November 21, 2022, the crypto began flatlining and ended 2022 at $16,547.50, a decline of 64.3% for the year. Coincidentally, almost a year ago, in November 2021, bitcoin hit an all-time high of $68,789.63.
Bitcoin’s bearish phase continued in 2023 until January 11th. Thereafter, the crypto started gaining some upward momentum and crossed $20,000 on 14 January. Since then, it has maintained support at this level. The $22,000 level was broken on Friday and the crypto crossed the mark and reached $23,000 the very next day.
Courtesy of Chart benzinga pro
See also: how to buy cryptocurrency
Why this is important: The new year has brought new hope in the market. The main positive catalyst is the expectation that the Fed will slow the pace of rate hikes at its February meeting Some even expect a break in subsequent meetings. The primary motivation for the Fed to take the foot off the pedal is showing a slowdown in growth due to the cumulative effect of rate hikes.
Morgan Stanley attributes recent rally to liquidation of short bitcoin futures Investing.com Reported.
“BTC’s rally has been bullish and driven more by technicals than by fundamental changes in market participants’ outlook. Trading volumes are low, and institutional activity is unlikely to pick up until BTC is physical,” the firm reportedly said. does not exceed form.
Key Levels to Watch: If the momentum continues, bitcoin faces the next test around the $24,400 level. Other resistance areas on the upside are near the $26,760 and $31,800 levels. On the downside, the $19,110 level will act as a support level for the crypto.