Bitcoin posted remarkable gains in January; Are Good Days Back?
January 2023 has been a good start for the downbeat crypto market. BTC gained nearly 40%, while ETH registered more than 45% gains
The year 2022 was a terrible year for the crypto market. But as the new year begins there are remarkable gains visible in the top crypto assets. Bitcoin was up 40% amid the risk on mood. A less aggressive tone from the Federal Reserve is one of the factors that bring investor attractiveness to the crypto market.
Bitcoin started the new year at around $16,500. But before the end of January month, it has already risen to over $23,500, resulting in a capital appreciation of about 41%.
The second largest crypto asset by market cap, the Ethereum price opened the year around $1,195 and reached the maximum of $1,680, with a total appreciation of 45%..
Despite the remarkable gains in January, analysts predict that the prevailing trend might alter the course in the near future.
With the recent gains, the price jumped back to pre-FTX collapse levels. Now, traders are on their toes ahead of the first 2023 Federal Reserve rate decision due later today, with Fed Chairman Jerome Powell giving much-anticipated commentary on the economy and future price projections.
The European Central Bank (ECB), and the Bank of England (BoE) will announce a similar decision on Thursday.
The market is gearing up for volatility ahead of the key events as it could impact BTC and ETH price action to change track immediately.
Technical update
From a technical perspective, price corrections could be expected in BTC. Currently, the price hovers near the 9-day Exponential Moving Average (EMA). A break below this level could see the next downside level at 0.23% Fibonacci retracement level of around $22K.
Ethereum follows the footprint of Bitcoin. As can be seen in the below chart. The price is consolidating near the higher level of $1,660. But, with the negative divergence on the Relative Strength Index (RSI), a retracement is expected toward $1,500.
