Crypto

Bitcoin Price Reaches $17,500 Despite Skeptical Investors

Bitcoin Price Reaches $17,500 Despite Skeptical Investors

Bitcoin made a promising return to $17,500 on the night of January 11 as newfound strength persists in the market.

Bitcoin (BTC/USD) daily chart

Source: Trading View

Bitcoin Fails to Convince Skeptical Investors

Data from Cointelegraph Markets Pro and TradingView showed that the price of bitcoin is making new highs in 2023 above $17,500. Almost at the December 16 high, Bitcoin saw a rare bullish momentum amid some of the lowest volatility on record for the holiday season.

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Traders and analysts expect an unpredictable reaction to the upcoming US macroeconomic data. The Consumer Price Index (CPI), due on Jan. 12, should reinforce the narrative that inflation is falling, providing a potential window of opportunity for risky assets.

However, many voices are calling for caution as there are still no signs of fundamental price support. Comments by Federal Reserve Chairman Jerome Powell disappointed markets the day before, avoiding any mention of future politics or the state of the economy itself.

“The real breakout or reset will happen on Thursday when the CPI data comes out,” summed up popular trader Johnny on Twitter.

A later post warned of a “bullish tweet as the BTC dollar is below higher time frame resistance at $17,600” and Jonny previously urged followers not to “feel FOMO driven, especially this week.”

“This week, the consumer price index may return prices to the level of last week,” he explained.

The conservative approach has proven to be symptomatic of a broader sense of apathy among market participants on a day when there is little faith that Bitcoin can mount a sustained rally.

Price predictions have been consistently weak over the past few weeks, with some of the more prominent traders focusing on $12,000, $10,000 or even lower. “Are we heading for ‘unbelief’?” asked Philip Swift, co-founder of Decentrader trading platform.

The bearish hold remained solid when it came to Crypto’s Il Capo, who shrugged off the recent cryptocurrency rally to insist that “there hasn’t been a single bullish confirmation yet.”

“Look. It’s there, right in front of your eyes. The downtrend continues,” he commented along with the BTC/USD 3-day chart. “Bitcoin and most of the market are testing broken support levels as resistance. We’ve seen it over and over again.”

Annotated BTC/USD chart

crypto capo bitcoin price January 11, 2023Source: Il Capo of Crypto/Twitter.

Altcoin Volume ‘Very Worrying’

The outlook for altcoins was equally dubious, with Ether (ETH) outperforming BTC at the start of the rally. Ethereum traded nearly 17% above the mid-December low of $1,150 on Jan. 10.

Ethereum Daily Chart (ETH/USD)

ethereum eth/usd 11012023Source: Trading View

When it comes to volume dominance, Maartunn, a member of the online analytics platform CryptoQuant, fears the worst.

“In 6 years of working in cryptography, I noticed something important. Healthy and sustainable price movements start with Bitcoin rising followed by Ethereum/altcoins,” he wrote on his blog.

“Usually, when traders get bored with bitcoin, they start trading altcoins, which tend to be lower on the risk curve. This makes them very brittle and easily compressible.”

The attached chart showed altcoins dominating by volume over 50% of the total volume, potentially serving as a warning to bulls.

“Today, altcoin dominance is over 50% again. Obviously, it shouldn’t be as heavy as these examples. But keep in mind: when altcoins continue to dominate, there is a potential risk of further declines,” he added.

Altcoin Volume Dominance vs BTC/USD Annotated Chart

bitcoin altcoins january 2023Source: CryptoQuant

William Subberg, Cointelegraph

William Subberg got into bitcoin when he got his master’s degree and has never looked back since then, writing about everything related to cryptocurrency that turns him on and attracts attention. He started working with Cointelegraph in October 2013.

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The opinions expressed here are solely those of the author and do not necessarily reflect the views of Forex Quebec. Every investment and trading move involves risk, so you should do your own research when making a decision.

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Disclaimer: The information and opinions contained in this report are for general information only and do not constitute an offer or solicitation to buy or sell foreign exchange contracts, CFDs and cryptocurrencies. Although the information contained herein has been obtained from sources believed to be reliable, the author does not guarantee its accuracy or completeness and accepts no liability for any direct, indirect or consequential damages that may result from anyone relying to such information.

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