bitcoin price chart
Bitcoin’s recent drop from $25,000 has not dampened the bullish outlook for the cryptocurrency market, with experts suggesting there’s a strong case for crypto prices to go up in 2023 and beyond. Several factors are driving this positive sentiment for Bitcoin’s price, including the upcoming March 2024 bitcoin halving cycle, institutional investor interest, and an indicator that has signaled a coming bull market.

Besides these potential bullish prospects, Bitcoin and the wider crypto market could also benefit from current Technical indicators suggesting this correction from Bitcoin’s run to $25,000 could lead up to another rally.

Strong January Start for Bitcoin Price Plus Bitcoin Halving

According to Matrixport’s recent research report, it is likely that U.S. institutions had a major hand in bitcoin (BTC)’s rally during January when the cryptocurrency gained an impressive 38% or more–which bodes well for its price going forward this year. An outperformance like this early on typically signals bullishness in the token’s value, wrote Markus Thielen, research head at Matrixport.

In five of the last six years, Bitcoin has rallied in January, and each time, the cryptocurrency has ended the year with positive returns, with an average gain of more than 245% for the rest of the year. The only exception was 2014, when Bitcoin declined after a strong January due to a bull-market peak, noted the report.

The expected March 2024 bitcoin halving cycle could be the driver of the 2023 bull market, according to an earlier report by Matrixport. This halving cycle would cause the amount of bitcoin entering the system every 10 minutes to drop by 50%, leading to a potential doubling of the bitcoin price to $45,000 by the end of the year, the report said.

Matrixport listed several other reasons they believe the market had rallies since the start of the year as well, including the fact that inflation is likely to come down in the coming year, bringing more optimism into risk asset markets.

DCA Indicator Bullish Signal for Bitcoin’s Price

Another factor that is fueling optimism in the cryptocurrency market and Bitcoin’s price is the Bitcoin dollar cost average (DCA) indicator, which has recently signaled a “raging” bull market, according to crypto market analyst Mohit Sorout. This is only the fourth time ever that the DCA indicator has flashed a green light, and each time it has preceded significant price increases for Bitcoin.

The DCA indicator measures the relative profitability of a hypothetical investment strategy in which an investor allocates a fixed amount of capital to gain exposure to an asset at set intervals. The indicator has historically been considered an optimal way of gaining exposure to volatile cryptocurrencies like Bitcoin.

Once the DCA indicator crosses into profitable territory, major bull markets have typically begun. According to Sorout, “today marks the 4th time this signal is suggesting a raging bull market,” which he described as “the mother of all BTC bullish signals.”

The signal is also getting attention from major Bitcoin investment circles. “Rare massive Bitcoin buy signal,” said Dan Tapiero, founder and CEO of 10T Holdings, in a repost of Sorout’s findings.

However, some analysts remain cautious about the DCA indicator’s bullish signal, noting that Bitcoin’s price is still facing significant resistance from several moving averages (MAs) overhead that have acted as resistance for much of 2022.

The Williams %R oscillator, another rare bull signal, has also pointed to a bullish trend for Bitcoin. However, depending on the timeframe, its signals do not yet point unequivocally to continued price increases.

Caleb Franzen, a senior market analyst at Cubic Analytics, warned that Bitcoin’s latest trip to six-month highs represents a “failed breakout,” indicating that the cryptocurrency could experience some short-term volatility.

Nonetheless, with the DCA indicator signaling a potential bull market, along with other bullish indicators like the Williams %R oscillator, some experts remain confident about the cryptocurrency’s future prospects.

Bitcoin Price Prediction Based On Technical Analysis

Finally, technical indicators point to a potential continued bullish outlook for Bitcoin and the wider crypto market as well. Even though the price was rejected from the $25,000 level on Thursday with a 3.33% loss, Bitcoin has quickly recovered today, before settling at $24,624 and hovering near break even levels.

This is an indication that buyers are willing to purchase at these levels, which could lead to another attempt to break over $25,000. With Bitcoin’s price aiming to retake this critical level, investors need to remain mindful of another resistance level that extends from $28,227-$28,589 as well.

This bullish sentiment is also supported by the crypto total market cap—a chart that has a direct relationship with Bitcoin’s price. As of writing, the total crypto market is trading above the horizontal resistance-turned-support range of $1.03 trillion to $1.05 trillion.

Technical indicators suggest bullish sentiment for the cryptocurrency market with the market trading at $1.059 trillion, close to the upper band of the Bollinger band with the middle band trending upwards.

The RSI is at a healthy 62.62, while the MACD’s histogram is in the positive for the first time since January 30, indicating that a potential bullish crossover is about to occur.

If the crypto total market cap manages to move further into the upside, the next target is the horizontal resistance of $1.15 trillion to $1.18 trillion.

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