The largest cryptocurrency by market value and altcoins have been showing high volatility for several days. The price fluctuation was due to profit-taking sales initiated by highly profitable wallets, but the situation has started to reverse. BTC has reclaimed the $42,000 mark while the danger at the $2,200 support level for ETH is easing.
Bitcoin (BTC)
On January 22, BTC fell below $40,000, about 10 days after being around the $49,000 mark. The price, which suffered a loss of nearly $11,000 within days, became the victim of traders who blamed GBTC outflows and MTGOX refunds. Experts like Chris Burniske pointed to abnormal lows during this process. After seeing the recent drop, Chris, who has repeatedly spoken about surpassing historical highs, pointed to $20,000 and even lower.
JPMorgan analysts announced in a market report dated January 25 that most of the profit-taking in GBTC had already occurred, hence the pressure on the price from this channel had been relieved.
On January 26, the bulls managed to move the price to the 20-day exponential moving average ($41,904). We will see a fierce battle between bulls and bears near the moving averages for the BTC/USDT pair. However, as we have been stating for the last two days, the strengthening liquidity in the support region suggests that bears are already facing a tough challenge.
The key region to watch for BTC is $42,904, and closures above this could continue up to $44,700. However, in the opposite scenario, we could see BTC sagging to $37,980, and in an environment where liquidity in this region weakens, it could drop to $34,800. This week’s closure should be closely monitored for this reason.
Ethereum (ETH)
The $2,168 support level was strongly defended by the bulls. A continued rise for ETH was expected at least until ETF postponement decisions, but BTC fell too quickly. As the final decision dates for Spot ETH ETFs are approaching and coincide with the halving period, a positive trend seems likely for ETH and altcoins.
In the short term, the targets of $2,400 and $2,100, as previously stated, remain relevant.
