Following yesterday's optimism after the Fed's decision, riskier assets, including cryptocurrencies, gained strongly. Bitcoin broke through the $35,000 barrier and is currently maintaining above that level. The market capitalization of the main cryptocurrency has increased by over 30% since mid-October 2023.
We are currently at an interesting point. Taking into account historical cycles and the direction of capital flow between sectors in the cryptocurrency market, the market may now turn towards smaller projects. Bitcoin has broken new highs this year and has seen an impressive price increase. Rises in Bitcoin have drained capital from smaller projects, including Ethereum, which over the same period grew less on average than BTC. If in the coming weeks we see a period of consolidation in the main cryptocurrency, even with small declines, capital may begin to flow into Ethereum and smaller Altcoins.
Start investing today or test a free demo
Create account Try a demo Download mobile app Download mobile app
On the technical chart of Bitcoin, we see that the increases have stopped at the $35,800 level, which coincides with the 37.8% Fibonacci retracement level of the entire Bitcoin cycle counting from the peak of the previous bull market to the bottom at the end of 2022. To break through this significant barrier, the market may need additional catalysts. Currently, the most likely are the acceptance of ETFs by the SEC and the upcoming halving in April 2023. However, it is not excluded that at the current levels we may experience a slight correction, and the price of BTC will start to consolidate, slightly losing towards the support zone at the level of $31,000 - $32,000. Source: xStation 5
The content of this report has been created by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. XTB S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.
