Bitcoin breaks through $18K and fights downtrend
|Market picture
Bitcoin rose on Wednesday on the back of stock gains and strengthened further on Thursday morning. In the low-liquid morning market, stop-loss orders were triggered, pushing the price up 4% within an hour and a half. The price climbed to $18.3K at the peak but then retreated to $18.0K.
Santiment estimates that crypto whales resumed buying in early January. In five days, addresses controlling between 1,000 and 10,000 coins increased their reserves by more than 20,000 BTC.
Realised volatility in bitcoin and Ethereum fell to extreme lows, which historically preceded explosive moves in either direction, Glassnode said.
Registering its 9th consecutive trading session of gains, Bitcoin is testing the downtrend resistance line and the area of previous local highs. Therefore, today's bitcoin momentum will likely be decisive for the next few days and may even register a long-term reversal, returning the market to the active buying phase.
On the other hand, the RSI on the daily charts has entered overbought territory as a long lull preceded the last rally. Are the bulls getting tired? We will find out in the next couple of days.
News background
Galaxy Digital founder Michael Novogratz said that we shouldn't expect cryptocurrencies to fall significantly, but it's too early to talk about a broad recovery. According to him, the cryptocurrency industry needs time to lick its wounds and restore confidence. But BTC and ETH have stabilised in recent months and have even risen in recent days.
Bloomberg strategist Mike McGlone said he believes in the future of the first two cryptocurrencies. Bitcoin and Ethereum will perform better than other assets, but they will still come under pressure when the stock market falls. McGlone is confident that ETH will hold support at $1,000.
According to Glassnode, the popularity of the stable USD Coin (USDC) has risen sharply since the collapse of FTX. Users are more likely to choose this stablecoin because of monthly audits by accounting firm Grant Thornton on USDC and the collateral of short-term US government bonds.
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