Bitcoin and 'altcoins' keep their rebound amid market jitters
By Noemi Jansana / Alejandra Zamora
Date: Tuesday 25 Jan 2022
(Sharecast News) - The rebound that took place on Monday in the cryptocurrency market, with Bitcoin clearly rebounding after touching six-month lows at $33,000, is still alive and well for the queen of digital currencies. Meanwhile, this optimism has ended up being transmitted to the 'altcoins'. Satoshi Nakamoto's creation left a high on January 24th above $37,000 and, more importantly, closed above $36,000. Now, experts expect it to consolidate around $35,000, while keeping their eye on the $30,000 barrier, vitally important support for the crypto asset.
Despite rises of around 8% in the last 24 hours, the plunge is still more than 15% in the last seven days and the correction from November's record highs, at $69,000, of 50%. As for the rest of the digital tokens, buyers did not come to the rescue of Ethereum, Cardano or Solana with equal intensity as, despite having rebounded from their lows, some are trading in the red on Tuesday. However, it is worth noting that Ether, the Ethereum network coin, returns to price levels between $2,300 and $2,500, after falling on Monday to a six-month low of $2,200, while other coins, such as Cardano, are also respecting their supports.
The violent volatility of these days is due to multiple factors that have been weighing down the price since the beginning of the year, including greater regulation of the cryptocurrency industry in the US and Russia. Also, the imminent monetary policy meeting of the US Federal Reserve (Fed) and the tensions between Russia and Ukraine, as well as with NATO and the US, cause a real selling panic in risk assets, which is hitting cryptos.
Monday's huge Wall Street bounce also added to the explosive mix, given Bitcoin's huge correlation with the US stock market, especially the tech sector.
While the latest news about the conflict is that the US has readied 8,500 troops for a possible Russian attack on Ukraine, jitters before the Fed will be mounting in the coming hours as steps are expected to contain rampant inflation and crack down on easy money, the main driver of exuberance for the 'crypto' market. "The story is really how aggressive the tightening is," commented Marc Chandler, chief market strategist at Bannockburn Global Forex.
$30,000, THE FINAL FRONTIER
Bitcoin is now at a critical juncture where analysts claim that further selling could reverse its long-term uptrend. Bitcoin now has a real test on its hands. "The psychological blow of losing $40,000 is nothing compared to what happens if $30,000 falls," pointed out Craig Erlam, an analyst at Oanda. "This is a major level of technical support that held throughout 2021, despite numerous tests early in the year and then throughout the summer. If this falls, it could get very messy," he warned.
For the very short term "anything is possible, even a violent rebound in the form of a pullback to the resistance (formerly support) at $40,000," commented José María Rodríguez, technical analyst at 'Bolsamanía'. "And more, taking into account that we have the price at the base (short-term support) of the bearish channel through which the Bitcoin future has been moving since the historical highs of November at $69,355."
"In any case, experience tells me that despite the 50% drop from all-time highs there has been no capitulation. There is fear, concern, many doubts, but there is no selling panic," the analyst concluded.
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN