- Data analysts are predicting that the bearish sentiment of the crypto market is at the “last phase”
- Bitcoin rallied 40% as of January 2023, regaining the $24,000 line
- Several analysts also warn that the market is due for a short correction before it can continue its rise
Bitcoin (BTC) made a great bang that started the year with green candles everywhere. For the first time since November 2022, BTC’s market cap reached $1 trillion, along with higher trading volumes.
As of February 1, BTC hit $24,000 – a value that the cryptocurrency never saw since June 2022. With the crypto rally showing healthy signs, on-chain analysts believe the bear market is almost over. Compared to QQQ, Nasdaq, and S&P, crypto has the highest recovery, although it could also mean the most significant loss if another correction awaits.
Crypto exchange Bitfinex noted that the latest breakthrough from the resistance line suggested that BTC has created a new bottom. Eddy Gifford, CoinDesk’s wealth advisor, said that if the price crashes, it could hit a support line of $20,000. After all, January was full of gains, suggesting that a large red candle can happen anytime this February.
Meanwhile, after the press conference from the US Federal Reserve, Chairman Jerome Powell made a transparent statement regarding money.
“We can now say, I think for the first time, that the disinflationary process has started,” Powell said.
With the Fed stating that the economic inflation is slowing down, many see this as a signal to buy – which is mainly speculated after BTC recently hit $24,000.
While the markets are not entirely out of the bearish conditions, analysts say they look better now than last year.
Data from Glassnode also shared insight regarding the trading volume of BTC for the past seven days. Glassnode said that short-term holders were actively selling BTC near $24,000, while long-term holders are showing signs of confidence – which could result in a bullish outcome by the end of the year.
Even so, the months are still early for the crypto market. Plenty of black and white swans are around the corner that will ultimately affect the price action.
On-Chain Flows Continue to Decline for BTC Miners
The market movement shows a continuous upward trend, but the story for crypto miners tells a different tale. According to reports, the amount of BTC from miner addresses to exchange wallets reduced to a new low for the third consecutive year.
It may sound like a hostile press, but lesser miner sales mean dwindling selling pressure from coin-makers. The crypto community has been looking for this kind of news since the crypto winter and why on-chain analysts predict that the bear market could be over anytime soon.
The last time Bitcoin crashed was in 2020, when COVID-19 struck worldwide. However, the following year, it hit its all-time highest of $69,000 before crashing to $15,700 after the FTX incident in 2022.
