11.01.202314:43 Forex Analysis & Reviews: Crypto market revives, global economy becomes more resilient: a series of important events continues

The starting point of the thaw in the market can be considered the first of January, when Bitcoin began an upward movement. In 11 days, the cryptocurrency reached the $17.4k level and confidently consolidated above the $17k psychological level. Among the nearest targets of the asset are the levels of $17.8k and $18k.

Despite the positive developments, the daily chart of the cryptocurrency shows an uncertain price growth at low volumes. A similar situation was observed in mid-December, when the cryptocurrency made a false breakout of the $18k level and began to decline.

However, judging by the latest news, the current local upward trend differs from the price movement at the end of 2022. Trading volumes in the cryptocurrency market have soared by 90% over the past day. The indicator reached the usual levels in the region of $30–35 billion. Recall that during the period of protracted consolidation, the volumes did not exceed $10 billion.

Another positive signal was another purchase of cryptocurrencies from large international companies. Google purchased large volumes of Solana at $10 and was one of the top 13 owners of the asset. In addition, Morgan Stanley began actively buying shares of Grayscale Bitcoin Trust. As of January 11, the firm had invested more than $3.5 million in crypto assets.

Gradually we move on to neutral news, namely the long-awaited speech of Federal Reserve Chairman Jerome Powell. According to the state of the market, we can conclude that the official was cautious in his remarks and did not provoke volatility spikes. Powell's key thesis was the acknowledgement that the global economy has become much more resilient.

This statement can be seen as a homage to the labor market and an effective inflation policy. The next key event for Bitcoin and the cryptocurrency market will be the publication of inflation reports. Data are expected on Thursday, and analysts predict a slowdown in inflation to 6.5% from the current positions at 7.1%.

Given the established dynamics of slowing inflation, we can assume that the publication of financial statements is already included in the price of financial instruments. At the same time, the forecasts have become much bolder, which increases the likelihood of their fallacy. Also, we must not forget that Bitcoin is locally overheated, therefore Thursday can be the starting point of a local correction of the asset.

BTC/USD Analysis

The cryptocurrency has been in continuous upward movement since January 1, 2023. The asset successfully overcame the downward trend line and the 0.236 Fibo level. The next targets for the coin will be $17.8k–$18k.

Bitcoin technical indicators are approaching the overbought zone, especially the stochastic, which broke through the 60 level. The RSI is also close to entering the overbought zone. At the same time, there is no increase in buying volumes on the daily chart, which may indicate the completion of the bullish impulse.

A similar uncertain move can be seen on the daily chart of the S&P 500. One day, the asset forms the largest candle since the end of November, but subsequently loses to buyers near $4,000. Given this, it can be concluded that the SPX price movement is an impulse surge of trading activity or manipulation by a market maker.

Results

Bitcoin is gradually passing the peak point of the upward movement as buying volumes are falling. Support from the SPX index looks unconvincing, as does the on-chain activity of the cryptocurrency. Given these facts, the asset needs a new impetus for growth, or a local correction.

The publication of inflation reports can be a key moment in determining the further dynamics of the price movement of Bitcoin. With a favorable outcome and an increase in buying volumes, the asset will go to the $17.8k–$18k area..