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Before the Asian markets opened, we witnessed a rapid series of declines in Bitcoin prices, but the price has since recovered. The statements made by Powell about 12 hours ago were not different from what he said after last week’s interest rate decision. Although the markets see the days when excessive optimism was curbed as a surprise, it was already known that this would happen. The Fed is not targeting a 150bp cut this year.
Current State of Cryptocurrencies
In January, the cumulative value of cryptocurrencies climbed to $1.81 trillion. Then, following the approval of an ETF, the support region of $1.61 trillion was lost, and the decline created a long upper wick. The rebound in cumulative value is promising for further increases.
On the other hand, LINK Coin is about to reach the $20 threshold we have been warning about since the $14 level. The price is at $19.5 and continues the day with an increase of nearly 7%. If the momentum can be maintained, LINK Coin bulls may find support for a new peak near $25.
Returning to the cumulative value of cryptocurrencies, a breakout here could trigger a 30% increase up to $2.1 trillion. This would mean a recovery of nearly 100% in many altcoins. On the other hand, a downward breakout would lead to double-digit losses in cryptocurrencies with a pullback to the $1.39 trillion support level.
Will Bitcoin Rise?
Bitcoin’s price has been trading within a rising parallel channel since December 2023 and then reached its highest level in two years near $49,000. On January 18, BTC lost the channel’s support, which was also a harbinger of the decline in the cumulative value of cryptocurrencies. After the recent drop, the price managed to recover, turning it into a deviation, which looks positive.
The rising support line for BTC is at $43,800, and the price is now struggling to reclaim this area. Breaking above this level or turning the area into resistance will determine the price’s trajectory. Investors should now watch how the price behaves at this decisive moment.
If Bitcoin breaks and rises above the channel’s support trend line, we could see the rise continue up to the resistance at $49,100. In the opposite scenario, closures below $41,000 could lead to a drop to $35,600.
