Bitcoin (BTC) price made a rapid rally above $43,100 in the US trading session, but uncertainty remains the dominant sentiment among traders on January 11, with bulls and bears divided over whether this week’s drop to $39,650 is the bottom of BTC.
Data from Cointelegraph Markets Pro and TradingView shows that the price of Bitcoin has been trading tightly around the $42,000 level as global financial markets digest the statements of US Federal Reserve Chairman Jerome Powell regarding upcoming fiscal policy changes.
Powell indicated that the central bank is prepared to “raise rates further over time” if inflation continues at high levels, but analysts were quick to note more comments, suggesting that the low interest environment may persist for some time.
It is possible that traders interpreted these comments positively and although it is not possible to link Powell’s comments to direct price action, BTC managed to quickly increase above $43,000.
It is really time that we move away from these pandemic emergency situations to a more normal level. It’s a long way back to normal from where we are.”
Here is a look at the debate over whether the cryptocurrency market is in a position to head higher in the coming days.
The bulls call the bottom
The cryptocurrency market is known for its volatility and history of intense declines after hitting new all-time highs, which is a distinct characteristic highlighted By anonymous Twitter user ChrisBTCbull.
This overall pullback has sent BTC down nearly 40% while Dogecoin (DOGE) is down 79% from its highs, but according to bullish analysts, recent technical developments suggest that the market has bottomed.
According to crypto-analyst and Twitter user Will Clemente III, Bitcoin is “entering the buying zone at the dormancy flow,” as shown in the Bitcoin entity’s modified sleep flow chart, which “price basically compares to spending behaviour.”
“This bottom signal has only flashed 5 times before in Bitcoin history.”
Related: Bitcoin price soared to $43,000, but traders warn that ‘real pain’ is due to crypto
The death cross looms on the horizon
Despite the January 11 rally to $43,100, many analysts are pessimistic about Bitcoin’s short-term prospects and warn that a possible “death cross” on the daily chart has historically been a strong bearish indicator.
as shown Below, the 50-day moving average is dangerously close to dropping below the 200-day moving average, a convergence that has, in the past, led to a sharp price decline.
Bitcoin Archive said,
“Bitcoin is nearing a ‘death cross’. The last time this happened was in June, the price fell 20% more over 31 days. That would drop to $34,000 by February 9th if it were to repeat.” .
As for the altcoin market, the recent price weakness in the USD and Bitcoin pairs was addressed by analyst and Twitter user pseudonym Bentoshi, who posted the following tweet indicating a more bearish performance in the near term relative to the alt changes.
Im a pretty bearish alternative. The funny part is that people are replying to me with their alternate variations that are in downtrends on both USD/CBK pairs. The point of rebounding is to make you chase your lower altitudes
I still think Btc is in a downtrend. BC it is. This is the reason to expect LH
– Pentoshi DM’S ARE SCAMS (@Pentosh1) January 11 2022
For now, traders seem content to play the waiting game to see if the crypto market will reverse its range-bound survival trajectory for the foreseeable future.
The total cryptocurrency market capitalization now stands at $1.998 trillion and the Bitcoin dominance rate is 40.3%.
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