Bitcoin is up 38.1% in January, its best start to the year since 2013 when it rose 44.05%. Another encouraging sign for investors is that February has historically been a strong month for Bitcoin. According to Coinglass data, since 2013, Bitcoin has ended the month of February in the red only in 2014 and 2018.
Along with the crypto space, the United States stock markets have also made a solid start in 2023. The S&P 500 has risen 4.64% this month, on track for its best January since 2019. Carson Group’s Ryan Detrick highlighted in a tweet that after a negative year, there have been five instances where the S&P has risen more than 5% in January and that has produced a 30% average return for the year.
After consolidating for a few days, the bulls attempted to resume the up-move on January 29 but the higher levels attracted aggressive profit-booking on January 30. We had warned in the previous analysis that the relative strength index was in the deeply overbought territory and a pullback was possible and that is what happened.
The bears will try to pull the price to the 20-day exponential moving average (EMA). This is an important level to keep an eye on because the bulls are likely to defend it aggressively. A strong rebound off the 20-day EMA could increase the likelihood of a rally to $25,000 where the bears may mount a strong defense.
If the bulls pierce this resistance, the BTC/USD pair could soar above $30,000 but we give it a low probability of occurring. On the downside, a break below $21,500 could suggest that the bulls may be losing their grip. The pair could then slump to the psychologically important level of $20,000.
Lastly please check out the advancement’s happening in the cryptocurrency world.
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