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Amid 2022’s bear markets, Bitcoin has been strugling to gain back. Bitcoin (BTC) had considerable oscillations that were caused by the larger market environment. By the conclusion of the week, Bitcoin (BTC) had gained 1.3% after briefly reaching the much sought-after $24,000 zone for the first time since August 2022.
In the midst of all the activity that was seen inside the area, the value of the original cryptocurrency, bitcoin (BTC), was susceptible to swings. These price shifts were brought about by a combination of crypto-focused advances and the general economic environment. BTC managed to close last week with a 1.3% advance while facing intense opposition at the highly sought-after zone of $24,000.
Santiment revealed on January 31 that the day before was bitcoin's greatest day of profit-taking since February 17, 2021. This information related to bitcoin's price. The occurrence pointed to the fact that the asset will start experiencing a downturn, and it was not far from the reality as BTC dropped by 3.86% on January 30 and finished the day below the $23,000 barrier. The drop was bitcoin's greatest intraday loss thus far in 2018.
Bitcoin was stated to have completed January with a 39% rise, giving the previous month its most lucrative January since 2013 and its greatest month since October 2021. This boost came despite the collapse that occurred on January 30. Moreover, in spite of the large whale movements that were reported the previous week, the percentage of Bitcoin's supply that has not been actively traded for at least a year reached a new monthly high of 66.75% on February 1.
A new study that was published in the past week indicated that interest in bitcoin risen by 82% in 2022 as more high-net-worth folks looked into the possibility of investing in the asset class last year. This is despite the fact that most industry players believe that the prior year was not desirable for bitcoin and the cryptocurrency industry.
The findings of a poll conducted by the American multinational financial services company JPMorgan on institutional investors revealed a different picture. According to the results of a poll conducted by JPMorgan, 72 percent of institutional investors are doubtful about cryptocurrencies in 2023, and these investors said that they do not intend to participate in the embryonic sector this year.
Despite this, optimistic emotions have been injected into the market as investors find newfound optimism as a result of the value growth seen with bitcoin and other crypto assets. In a research that was published last week, Ark Invest reaffirmed its positive prognosis for bitcoin and maintained that the commodity would reach $1 million by the year 2030. Mark Yusko, the chief executive officer of Morgan Creek, predicted that the summer bull run in cryptocurrencies would start somewhere during the second quarter of this year.
Crypto Tony, a veteran cryptocurrency analyst, made a prediction that despite the fact that bitcoin might get caught up in a bearish trend in February, the asset is probable to stage a breakout that would lead to the recuperation of the price point of $24,000. Bitcoin climbed to a high of $24,255 on February 2 before encountering resistance that caused it to close the day at $23,488. This marked the first time since August of last year that Bitcoin had reclaimed the $24,000 zone.
Should you rule out a bear run?
Benjamin Cowen, a well-known cryptocurrency analyst, has calculated a price target for bitcoin (BTC) in the event that its value were to significantly drop.
A new strategy session that was uploaded by Cowen to YouTube informed his 783,000 followers that the value of bitcoin may drop by more than 47% relative to its current level in the worst-case scenario.
According to Cowen, bitcoin may experience a recovery over the next few months. After that, the price may backtest a diagonal trendline, which would put the price of the leading cryptocurrency at $12,000 in August 2023.
Cowen goes on to explain that if November wasn't the bottom, then BTC could perhaps likely correspond to the 2022 trendline once more to reach the next low in August 2023. He also says that BTC might have broken a $26,000 resistance in the months leading up to August, which would put the bottom of the market at $12,000 as of August 2023.
"Obviously, this assumes that November is not the bottom, but it does show that it is possible once more. Therefore, that's the absolute worst-case scenario."
While still looking at the charts, Cowen evaluates the price of bitcoin in relation to its 50-week moving average in order to determine the likelihood that it will drop below the level it reached in November 2022.
The expert believes that the 50-week moving average has previously served as a crucial resistance indication during a prolonged bear market and that it is likely going to be about to do so once again in the near future.
According to Cowen, the 50-week diet typically meets with some degree of resistance, at least on the initial attempt. In 2019, however, it is possible for the markets to surpass it, despite the fact that there was some uncertainty in the markets for approximately one month before they did so.
According to him, the 50-week is currently a little bit higher than $25,000, which is the same as the previous local high in January 2022. Cowen believes there is still time for another break over the level that is currently acting as resistance before the drop is seen. This is not the first analysis that has shown the possibility of a bear market occurring in 2023; many people are afraid that this could happen.