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Despite a strong first week of 2023 for equity indices, the current uncertainties in the financial markets have just eased. For example, although inflation in the US has peaked, it remains at high levels since 2008. This does not bode well for the Fed's monetary policy flexibility. Hence the lack of BTC and ETH price movement that has persisted since the FTX crash.
In an already confusing context, let's review the latest technical analysis of Bitcoin and Ethereum in weekly units. With the hope that a market scenario decant.
Bitcoin in Weekly Units – Finally a Real Bounce Above $16.000?
Asian time, Bitcoin has awakened sharply to finally break through the $17.000 barrier with greater ease. While this is a stretch, it also allows the MACD and RSI to maintain their momentum towards the zero line and the neutral zone at 50 respectively. Furthermore, we still have bullish divergences between BTC prices and technical indicators. But for now there is still a long way to go to validate them.
And for good reason, Weinstein's Phase 4 would be far from aborted by buyers. Even if it loses intensity due to a 30-week moving average (MM30 weekly), which in turn sees its downward slope bend significantly. However, resistances must be broken. For the weekly chart above, Buyers are waiting for favorable signals.
Assuming the return to $16.000 is forever confirmed, we could drive Bitcoin prices higher with the prospect of reaching $20.000.which turned from support to resistance at the time of the FTX crash. But as we said earlier, it will take more than $20.000 to see a bear market pullback. For this reason A return to the $26.000-$30.000 area would potentially be a major starting point for the buyers.
In reverse, the break of $16.000 would psychologically sink the buyers with a third wave of correction towards $12.000. If so, the current bearrun would converge to the historical standards of these precedents in 2014 and 2018.
Ethereum in weekly units – possible return to 1400?
Ethereum is in a better position in terms of weekly units than Bitcoin. If the bear market from the last ATH of November 2021 remains, it has the merit of not touching the lows of mid-June 2022 to avoid the appearance of a third wave of correction. However, the resistances above his head have not been broken so far, despite multiple attempts.
But after the good monetary news from China, ETH prices are approaching $1400. So much so that $1200 currently serves as support. At the same time, technical indicators are moving higher. But how difficult it is to renew contact towards the respective water lines.
Assuming we're riding the current momentum this week, the possibility that Ethereum breaks through $1400 would lead to a rebound towards $1700a resistance that the buyers have overcome. And if he smiles even more, prices could be pushed towards $2.000.
Otherwise, a break of $1200 would take us back to $1000, not far from last year's lows. And after that it shouldn't be more complicated. Because that's the point, a sharp break below $1000 would trigger a new wave of correction towards $700.
BTC and ETH – Bear markets stalled but buyers still absent
While the Bitcoin and Ethereum bear market is no longer accelerating to the downside, it is clear that the buyers are not making any effort to reverse the trend. And purely graphically, The resistances are turning out to be walls that are difficult to break down. To be precise, all the rebounds since last summer have been sold.
Added to this is a crisis of confidence in cryptocurrencies following scandalous episodes (the collapse of Luna and the bankruptcy of FTX), which would risk blocking when all the abuses are partially eradicated. And secondly, moving from a disinflationary to an inflationary cycle would cause the Fed to be more hesitant about monetary easing. As a result, Bitcoin and Ethereum could lose their main bullish support, central bank liquidity.
Therefore, investors accustomed to Bad news is good news for nearly fourteen years, they fell off their chairs. The hypothesis that the FED does not intervene to put out the fire by opening the liquidity valves, would mean thata new monetary paradigm is emerging. With inflation expected to stabilize at higher levels in the 2020s.
In this case, the investment models of the last four decades would be partly called into question. And for BTC and ETH, which did not evolve in a sustainable inflationary environment, we are now in uncharted waters.
