On January 31, the price of Bitcoin saw a significant drop, falling below $23,000. This sudden decline came after the cryptocurrency hit a five-month high just a few days prior. Since the drop, market volatility has intensified as traders brace themselves for a period of significant economic data releases from the United States.
Today, the Conference Board will release its Consumer Confidence Report, and on Wednesday, the Federal Reserve will hold its Policy Meeting. It’s worth noting that Ethereum also experienced a drop in value today.
Bitcoin Declines
On Tuesday, Bitcoin (BTC) experienced a retreat from its recent five-month high, with prices dropping below the $23,000 mark. In today’s session, the BTC/USD pair saw a low of $22,657.58, just a day after reaching a high of $23,296.53.
This dip in price can be attributed to traders who appear to have secured their profits from the recent price surges, as well as anticipation for the forthcoming Federal Reserve policy decision. This drop in price provides a noteworthy example of the volatility and unpredictability that is often present in the cryptocurrency market
The recent drop in the price of Bitcoin, as displayed on the chart, has brought it closer to the established minimum price of $22,500. At the same time, the relative strength index (RSI), a widely used technical indicator that measures market momentum, has also reached its low point. The current RSI value is 68.78, slightly above its long-term support level of 68.00. This suggests that the market may be reaching a state of balance.
However, there may be bullish investors who are hoping to reach a maximum price of 77.00, which could be considered a ceiling. Nevertheless, the prices of Bitcoin will likely remain stable and consolidated in the short term until the market has fully absorbed the effects of the current week’s fundamental events. This period of consolidation will provide market participants with time to reevaluate their positions and make informed decisions.
Ethereum Price experiences a decrease
The price of Ethereum has experienced a decline and dipped below the crucial support level of $1,600. Despite this, there were instances of bullish activity near the $1,550 level, leading to the formation of a low at $1,530. This was followed by a significant increase, similar to that of Bitcoin.
Ethereum prices saw a break above the resistance levels of $1,565 and $1,580. The price further increased, surpassing the 23.6% Fibonacci retracement level of the downward wave that began at the $1,660 swing high and ended at the $1,530 low. The price even spiked above the resistance of $1,595 and the 100-hourly simple moving average.
However, Ethereum is currently facing strong resistance near the $1,600 zone and is trading below the 100-hourly simple moving average. A key rising channel is forming with support at $1,575 on the hourly chart of ETH/USD, providing further insights into the current market trend.
The current resistance level for the price of a certain asset is located near $1,595, which is also close to the 50% Fibonacci retracement level, derived from the downward price wave starting from the $1,660 swing high to the $1,530 low.
The next significant resistance is observed near $1,610. If the price manages to break above this resistance level, it could signal a positive price movement. In such a scenario, the price might rise toward the $1,660 resistance, and if it continues to rise, it could potentially reach the $1,720 level
Final Thoughts
Shortly, it’s expected that Bitcoin values will remain steady and consolidated. The decline in the price of Ethereum below the $1,600 support level was followed by a bullish activity, leading to a significant increase. Despite facing strong resistance, the formation of a key rising channel with support at $1,575 provides valuable insights into the current market conditions. You must make a proper investigation before making any investments.
Ken Emmanuel is a Blockchain Content writer, a Web3 Enthusiast and a Social Media Management Strategist, he likes writing educative contents to help people gain more knowledge and get inspired. The growth of any organization he work with is always his priority. He is a Geographer by profession and loves reading.
