Will Bitcoin bulls remain in control of BTC price after another volatility-filled week?
- Bitcoin long-term holders are not ready to sell their BTC holdings despite the recent rally in the cryptocurrency.
- Derivatives data is positive with both long-short ratio and lending rates showing that bulls are in control of Bitcoin.
- While days ahead hold further macro catalysts for Bitcoin price, it remains to be seen whether BTC traders would unlock gains after massive gains.
Bitcoin price witnessed a massive rally in January 2023, and sustained above the $23,000 level while facing macroeconomic headwinds. Another week of catalysts could test the resolve of bulls as BTC price remains firmly the two-year lows of the bear market at $22,800.
Also read: Elon Musk's favorite altcoins: Will Dogecoin price be the next to rally after MASK?
Bitcoin bulls battle brutal crypto winter amidst key macro events
Bitcoin traders brace for a volatility-filled week after the first week of February 2023. Macro events could test the resolve of bulls who pushed BTC prices higher, throughout January 2023.
BTC 1Y price chart
BTC price hit six-month high above $24,000 amidst a rally fueled by bullish sentiment among investors and optimism of the end of the bear market. While Bitcoin price is currently a third of its late-2021 high, traders in the derivatives market are optimistic with calls exceeding puts, signaling a bullish bias.
Bitcoin enjoys correlation with stocks, moves in step with S&P 500
Bitcoin continues to be correlated to US equities, and S&P 500 as investors react to the complex macroeconomic conditions with the looming risk of recession. In the first week of February, crypto prices witnessed a spike in volatility with the Federal Reserve’s rate hike decision, and higher than expected addition of Nonfarm Payrolls in the US economy.
Bitcoin/USD chart with S&P 500
Fed chair Powell’s dovish commentary and massive addition of jobs could swing the sentiment in crypto market participants over expectations surrounding the future rate hike. Rachel Lin, the CEO of crypto derivatives Synfutures was quoted as saying:
Altcoins outperformed Bitcoin last week with the [Bitcoin Dominance Index] falling for the first time in several weeks, which shows that the broader crypto market is catching up to Bitcoin’s initial rally and signaling that retail enthusiasm may be returning to altcoins.
It remains to be seen whether market participants take profits or bulls stay in charge and continue pushing the asset’s price higher, despite altcoin rallies and capital rotation into meme coins and DeFi tokens.
Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
