Bitcoin Price: A Potential Rebound Amid the Crypto Crash

The Bitcoin price recently slipped to $90,000 on January 13, as the ongoing weakness in the cryptocurrency market persisted. Bitcoin’s value has crashed by 16% from its highest level in December, hovering near its lowest point since November 19. Other altcoins, such as Solana and Cardano, have also continued their downward trend.

Factors Contributing to the Crypto Crash

The ongoing crypto crash can be largely attributed to rising expectations that the Federal Reserve will adopt a more hawkish stance this year. These expectations grew after the U.S. published strong nonfarm payroll data on Friday, which showed a drop in the unemployment rate to 4.1% in December, along with the addition of over 256,000 jobs. As a result, stock prices decreased, and government bond yields increased.

Potential Catalysts for a Bitcoin Rebound

Two key factors could contribute to a potential Bitcoin rebound. Firstly, the upcoming U.S. consumer inflation data, scheduled for release on Wednesday, may impact the market. Economists expect the data to show that inflation rose from 2.7% in November to 2.9% in December. Core inflation, excluding volatile food and energy prices, is expected to remain at 3.3%. If the inflation numbers come in lower than expected, it could spark a recovery in crypto prices. For instance:

  • Headline Consumer Price Index drops to 2.5%
  • Core Consumer Price Index drops to 3.0%

Another factor to watch is the upcoming inauguration of Donald Trump, which could impact the crypto market. Trump has campaigned on making the U.S. the global crypto capital and has already made some moves toward that goal. His upcoming inauguration and the resignation of Gary Gensler may lead to hype in the crypto industry, particularly as companies like MicroStrategy and Semler Scientific continue buying Bitcoin.

Bitcoin Price Technicals

Bitcoin’s technical setup also presents a potential catalyst for its price. BTC is holding at a key support level of $90,100, a point it has not breached since December. This suggests that bears are hesitant to place short positions below this level. Additionally, the accumulation and distribution indicator has been rising, signaling ongoing accumulation. While the $90,100 support level forms the neckline of a bearish head-and-shoulders pattern, Bitcoin is likely to bounce back this week.

Historical data also shows that Bitcoin tends to rebound after falling on a Monday. As the crypto market continues to evolve, stay informed with the latest news and updates on Global Crypto News.

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