Most cryptocurrencies are bearish, although selling pressure seems to be slowing down from last week. Bitcoin price has dropped about 9% over the past seven days, having just recovered slightly above $42,000 after falling below $40,000 for the first time since September. At the time of writing, BTC is changing hands at $42,316.
BTC/USD 4-hour chart | Source: TradingView
Bitcoin price briefly hit a 5-month low this Monday at $39,650
Bitcoin fell again on Monday during US trading hours following a small rally over the weekend. It briefly dipped below $40,000 in the early hours before bouncing back above $42,000. The downside move comes after US stock markets suffered deeper losses as investors braced for action from the more hawkish Federal Reserve. Last week, the price of the oldest cryptocurrency fell for six straight days after Fed minutes revealed policymakers discussed aggressive rate hikes along with a faster pace to normalize its balance sheet.
“Bitcoin didn’t get a lot of utility to start in January and it was notable for a slight drop in $BTC circulation (the only daily tokens that are moved) and active addresses (addresses). online transactions only). Look for an increase as a harbinger of change,” says Santiment.
The source: Santiment
Selling pressure is starting to wane after last weekend’s drop. The cryptocurrency is holding short-term support at around $40,000, although gains appear to be capped near $43,000 – $45,000.
The Relative Strength Index (RSI) is rising from oversold levels on the 4-hour chart, which usually occurs before a short-term bounce. On the daily chart, the RSI is the most oversold since Dec. 10. Bullish momentum has waned due to BTC’s two-month downtrend. This means that sellers are likely to remain active around the resistance levels.
Following Bitcoin, most major cryptocurrencies are also in the red on Monday. Ether plummeted below $3,000 at one point before it went back above $3,000. The underperformance of altcoins shows that traders are still cautious. Altcoins tend to fall more than BTC during market downturns due to their higher risk profile.
In another development, large whale transactions do not happen with such frequency in October or November. Our metrics indicate that the BTC network is receiving around 13k transactions per day in excess. 100 thousand dollars in value. ETH’s network is hitting around 9k per day.
The source: Santiment
The overall crypto market cap is $1.954 trillion and Bitcoin Dominance is 40.8%.
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