Jan 30, 2023 at 06:38Contents
Bitcoin (BTC) continues to hold above the $23K resistance level since January 27. There is an opinion that this is the beginning of a new bullish rally, and soon the token will fix at $25K. However, it is not excluded that it is just another bearish manipulation, aimed at the growth to earn on the falling market.
There are plenty of opinions about whether this is a false-bull market or whether BTC is going to grow at last. So let’s figure out what will happen to the coin next.
Bitcoin’s ups and downs
Bitcoin hasn’t broken the $20K bar since August 2022. Back then, the token fell 29,14% in just two days, from $20.511 to $15.883, after the head of the U.S. Federal Reserve said they had no intention of lowering the rate. The interest rate at which U.S. banks lend their excess reserves for short terms to other banks. When the Fed raises the rate, the value of BTC falls.
After that, Bitcoin began a long plunge to the bottom, which lasted until early 2023. On January 9, the value of all assets, including BTC, began to rise rapidly. Experts link this to falling unemployment (from 3,7% in November 2022 to 3,5% in January 2023) and inflation (from 7,1% to 6,5%) in the U.S. Since then, Bitcoin is up 36,1%, from $17.093 on January 9 to $23.263 at the time of writing.
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Now there are signs that the token will go higher.
Is it a true bull rally?
According to Bytesyzecrypt technical analysis, Bitcoin first gained support above the $22.5K support level 
Refers to the price level that an asset doesn’t fall below for a period of time, now formed a steady base, and continued to grow already in the $23K resistance level A level in which the price of an asset stops appreciating because of increased supply from sellers.
Trader Seth Michael Steele believes that the resistance level at $23.5K could turn into a support level, and after that, the rally will continue to $30K.
*sniff sniff* smells like we are about to flip $23.5k resistance as support and continue the rally most likely surging to $30k in the coming 30 days. NFA! just sniffing my $BTC, however my approach has never led me astray. I believe my nose knows. I follow it everywhere. #Bitcoin pic.twitter.com/NP3k3LXWHP
— Seth Michael Steele (@s_michaelsteele) January 29, 2023
Crypto analyst CrediBULL Crypto also believes the rally will continue. In his opinion, Bitcoin is firming for now before jumping above $25K.
This doesn’t look like the end of our rally just yet. Local PA looks like consolidation before we continue our pump to 25k+. $BTC https://t.co/VpL7Xh0Kzz
— CrediBULL Crypto (@CredibleCrypto) January 22, 2023
Crypto trader and Bitcoin expert Muro said that BTC will grow the day before on January 29. At that time, the coin was still at $22.5K resistance level.
“If it [Bitcoin] break [sic] this $22.5K resistance and continue bullish it could rally into the next strong support level at $29K–32K,” he said.
Reasons to be skeptical about the rally
Popular cryptocurrency hater Peter Schiff expressed one of the most skeptical views. However, after his predictions that Bitcoin would fall and should be sold, the token, on the contrary, rose during January’s boom by more than 35%.
According to crypto analyst FutureBlockchain, Bitcoin is already trading above its monthly resistance, but the possibility remains that this is a continuing bear market. That is, it is a plan by market participants who make money on falling prices. They believe in further price declines, so they open a short position during a fall in the value of the asset. But their main goal is unclear.
However, FutureBlockchain’s prediction is not entirely skeptical. In his opinion, if everything goes according to the best-case scenario, based on his technical analysis, Bitcoin could rise to $46K.
According to blockchain expert Crypto in Black, one never knows how sustainable a bull rally is right now. However, here’s what his sources say:
- Most high-net-worth individuals and companies are sidelined and wait for a new bottom.
- Crypto Twitter and newer investors are more bullish.
However, whether this rally is bullish or not doesn’t matter if you’re a long-term investor, says Crypto in Black. But here’s what else suggests that the rally is about to end.
- High tech layoff rate (55K January 2023 versus 100K in 2022).
- Company earnings season below expectations. Earnings for S&P 500 companies are projected to be down 4,1% from 2022 (31%). This could be the worst performance since the peak of the pandemic in 2020.
- Recessions fears. Bank of America notes that it is “all but inevitable.”
- Continued rate hikes by regulators.
- Potential real estate crash. However, according to Forbes, most experts do not expect this. That’s why many owners have invested a lot of money in their properties.
In the opposite case, the market will go up.
Why is Bitcoin growing right now?
One reason, according to Crypto in Black, could be a slowdown in inflation in the U.S. This could help investors feel more confident and start building their portfolios again. Also, Bitcoin’s current rise could be due to the following reasons:
- Investors expect lower/stopped Fed rate hikes.
- Low market liquidity made it easier to pump.
- Just normal supply-demand dynamics.
- DCG, a venture capital company, and its subsidiary Grayscale, digital currency asset management company. Grayscale’s largest source of revenue is a fund that holds more than 600K BTC. Ongoing proceedings at the company related to layoffs could affect the value of the token.
Why has the market pumped?
Theories
1. Inflation coming down (7.1 >6.5)
2. Investors expect lower/stopped Fed rate hikes
3. Low market liquidity made it easier to pump
4. Just normal supply- demand dynamics
5. DCG/Grayscale Manipulation pic.twitter.com/uPUIjHPcxw— Crypto in Black (@thehiddenmaze) January 23, 2023
According to crypto enthusiast Ricky Dorwani, the bull market for Bitcoin has not started yet, and we should not wait for it until October-November 2023. In the meantime, the token will fluctuate around $19K–$40K.
We can expect a BTC bull rally only & only after Oct-Nov 2023 not before that.
We can see a play of 19k-40k levels till then#cryptotrading #Crypto #cryptomarket #BTC $btc#ETH #SHIBARMYSTRONG— Ricky Dorwani (@DorwaniRicky) January 27, 2023
And this opinion has the right to exist, but how it will be in reality, we will just have to find out. All of the above is not financial advice, so before you invest, do your own research.
Our expert opinion
We asked Web3 advisor Eloisa Marchesoni for a comment about Bitcoin’s rally. Here’s what she said.
Is the Bitcoin bull market back, or is this an attempt to artificially increase the price in order to crash the market again?
No, I don’t believe it’s back.
If this is a bull rally, how much can Bitcoin rise in the near future? How sustainable is this rally? What could prevent Bitcoin from rising? If it falls, by how much?
The rally is not sustainable, especially given the macro situation. Bitcoin may keep rising to max $30,000, but should then be hit by the due reality check and drop to higher lows. That’s unless some other black swan event shocks the crypto market, bringing Bitcoin to 4 digit price levels (its floor price, basically), against which there’s not much we can do other than hope it doesn’t happen.
If it’s not a bullish rally, when will it happen? Who benefits from it?
The super cycle may start towards Q2 (optimistic) or more towards the end (realistic) of this year. Institutional investors and whales will benefit the most.
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