Cryptocurrency market sentiment remains relatively subdued, with most altcoins managing to recover only a portion of their losses after the sell-offs in January, although Bitcoin itself has already managed to rebound nearly 10% from the bottom of its declines at $39,000 and is currently trading at $43,000. Since the end of December, the dollar index has managed to rise nearly 4%, supported by strong macro readings from the U.S. economy, but Bitcoin itself proved virtually insensitive to this fact.
Similarly, sentiment was not dampened by the hawkish Fed announcement, which moved the expected cut from March, to May. Looking at the very strong data and the potential set of macro risks, it is still uncertain whether the Federal Reserve will decide to loosen policy in May, but Bitcoin's correlation with the dollar index and the stock market has been disrupted recently, signaling that BTC is sometimes trading, with no reaction to global factors. The attention of the Bitcoin investor market is now shifting to the U.S. banking sector, where the recent crash in New York Community Bancorp (NYCB.US) shares may foreshadow the next 'spring' installment of the banking crisis.
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- JP. Morgan pointed to higher activity by hedge funds shorting regional banks, and Goldman Sachs data suggests that funds have increased short positions in shares of regional US lenders for 7 of the last 9 weeks. Hedge fund activity remains limited, however, to regional lenders.
- U.S. regional lenders' shares fell nearly 8% on Jan. 31, when the NYCB reported an unexpected provision for loan losses ($552 million) that was more than a dozen times higher than forecast. According to Ortex, speculative short positions on the bank's shares gave the funds more than $1 billion in gains.
- JP. Morgan stressed that speculators opening short positions on banks are poised to benefit from another 'turmoil' in the banking sector. The banks' problems could prove positive for BTC. Its price rose nearly 50% in the spring of 2023, when SVB collapsed. With this in mind, a potential next, even 'mini-crisis' could provide an additional bullish argument for Bitcoin.
Bitcoin and Ethereum chart
Looking at Bitcoin's chart, on the D1 interval we see a potentially bearish head-and-shoulders pattern where a drop below the 23.6 Fibonacci retracement ($41,000), of the upward wave from the fall of 2022, could mean a break below the neckline and drive the price even to the area of the SMA200 ($34,000red line), at the level of which there is currently an important on-chain level, i.e. the average purchase price of BTC by all, active investors (a level often tested during corrections, in previous upward cycles). In the opposite situation, important levels for Bitcoin are around $48,000 (recent peaks) and $50,000 (psychological resistance zone).
Source: xStation5
The recent magnitude of the gains on Ethereum may be a harbinger of a broader continuation or even a prolonged period of weakness. Sentiment, however, will depend heavily on the next signals for the Ethereum ETF and the sentiment in the Bitcoin market itself. A scenario seems possible in which ETH's gains will accelerate only in the final phase of the closing ETF (ETC) fund 'approval' window at the SEC, closer to the summer period. On the other hand, a potential rally in Bitcoin before halving (roughly mid-April 2024) could push the price up, even into the $3,000 area.
Source: xStation5
Bitcoin remains cyclical in the current halving cycle. In previous cycles, a new record price level was reached at about 220 to 240 days, after halving. This time it would suggest a new ATH, still in Q4 2024. 
Source: DecenTrader
The chart below shows the average profit on BTC sent from private wallets, to cryptocurrency exchanges. At the height of the speculation surrounding the ETF proposal, the indicator pointed to an average profit of $3.1k (the same level as that achieved during the peak of the 'anti-banking boom', in April 2023). The result is still far from the average profit of $10.5 thousand on deposited BTC on exchanges, at the peak of the bull market in 2021. 
Source: Glassnode
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