Bitcoin (BTC) dawned bullish this Thursday to surpass the $18,000 mark, a price it had not reached since last December 14.
Since the start of the year, BTC has been on an upward trend, as buyers take control of the cryptocurrency after a period of little movement in its price.
At the time of writing, bitcoin is trading at $18,099.84, following a 3.92% increase. Meanwhile, on the weekly chart, there was a 7.29% rise in the price of the asset.
This rally has also had an impact on its market capitalization, which reached $349.9 billion. Moreover, this rise in bitcoin’s value over the past nine days represents its best streak of consistent gains since 2021.
What’s going on with bitcoin?
The current uptrend in bitcoin may be due to several factors, most notably the projection of a less aggressive interest rate hike by the U.S. Federal Reserve (Fed).
US inflation data released Thursday showed a modest decline, according to the Financial Times.
The consumer price index (CPI) decreased by 0.1% in December, in line with estimates on the Dow Jones. However, the CPI rose 6.5% compared to 2022. This is down from the 7.1% jump in November and the peak rate of 9.1% in June.
Investors expect this drop to put pressure on the Fed to reverse interest rate hikes. This may have had a positive impact on the bitcoin price and contributed to the current uptrend.
The bitcoin’s rise to $18,000 also comes after news that the FTX exchange recovered $5 billion in cash and cryptocurrencies, the Wall Street Journal reported.
The collapse of that platform accelerated the extended fall in the price of BTC in 2022. The recovered FTX funds are expected to be used to pay creditors.
What do experts say?
Cryptocurrency analyst Altcoin Sherpa mentioned on Twitter that bitcoin will soon reach the $19,000 price range.
$BTC: Eventually I think that 19k is the area that price will go to, just don't know if we dip first or not. I think we fill this gap out a bit and there's more liquidity higher than current price. #Bitcoin #BTC pic.twitter.com/aXJySEDJhX
— Altcoin Sherpa (@AltcoinSherpa) January 10, 2023
“BTC: I think eventually the price it will go to will be $19,000. I just don’t know if it will go down first or not. I think we fill this gap a little bit and there is more liquidity above the current price,” he said.
Similarly, he cautioned that despite the recovery in the cryptocurrency market in recent days, the bottom may not yet have been reached.
However, he stressed that this does not mean that there are no opportunities for profit through price action.
IMO It's unlikely this is the bottom, there's still probably more pain to come. With that said, there are still opportunities like the ones we have had the last few weeks- enjoy these times because it could be a while before we get another mini alt run like this one. pic.twitter.com/sUC7NEaZXm
— Altcoin Sherpa (@AltcoinSherpa) January 10, 2023
Bitcoin is making gains again
Analyst firm Glassnode revealed that, as bitcoin heads toward $18,200, more than 13% of the circulating supply has returned to generating profits for its holders.
“The strong upward movement observed in this metric helps confirm that a large volume of BTC was acquired between $16,500 and $18,200,” the firm highlighted on its Twitter account.
As #Bitcoin rallies to $18.2k, over 13% of the Circulating Supply has returned to profit.
The observed sharp move upwards in this metric helps to confirm that a large volume of $BTC was acquired between $16.5k and $18.2k.https://t.co/yflZloDbSP pic.twitter.com/J8egLvYt3w
— glassnode (@glassnode) January 12, 2023
According to Glassnode, the increase in bitcoin’s bid-to-earnings ratio during the latest rally confirms a buying scenario during its fall.
The metric suggests that a large volume of BTC was purchased at prices located between $16,500 and $18,200, during the last month.
The cryptocurrency hit lows of $15,600 in November 2022 after a violent market reaction to the FTX collapse, but bounced back above $18,000 in mid-December, before falling back below $17,000.
According to Glassnode, more than half of bitcoin’s circulating supply experienced losses between November and January this year. Approximately 47% to 48% of the BTC supply saw gains during that period.
However, with the positive start to 2023 for cryptocurrencies and Tuesday’s surge in bitcoin price above $18,100, the percentage of circulating supply in profit increased to 60.5%.
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