Leading the price recovery today are the queens Bitcoin and Ethereum, both gaining more than 15% in 13 days, heading to close the second consecutive week in the positive.
On balance, this is an average gain of more than a percentage point daily for Bitcoin and Ethereum.
In recent years, only January 2018 had seen such a solid start with only 2 out of 13 days ending fractionally lower.
Further helping to inflate the bullish sails is the strong performance of stock indexes, particularly the tech sector with the Nasdaq index up 5% since 1 January, confirming the continued correlation between the stock and crypto markets for about 2 years.
Recent positive US inflation data, but also the release of other encouraging economic data, have changed investors’ attitudes with the first favorable signs of turning the global economy around and hopes of recouping losses from the bear market of 2022.
The bullish price movement is accompanied by the collapse of daily implied volatility measured on the monthly forecast, which has fallen to its lowest level in 6 years.
The period of prosperity in the crypto markets is crowned by metrics measuring investor sentiment. In the past few hours, the ‘Fear & Greed Index’ has risen to 31 points, on a scale of zero to 100. This is the highest level since the beginning of last November.
Among the top 10 non-stablecoin cryptocurrencies, Cardano (ADA) climbs to the podium with a gain of over 25% in the past 7 days, which rises to 35% when adding up the previous week’s performance.
Analysis of the price trend of Bitcoin and Ethereum
The first cryptocurrency for the largest market capitalization and the strongest network, rises above the psychological threshold of $19k for the first time in over two months.
In the last few hours, the price tries to push toward US$19,200, aiming for the historic US$20k level.
Technical signals supporting the uptrend are beginning to increase, even though support levels need to be consolidated to validate a solid bullish structure.
To continue a bullish trend in the coming weeks, it will be necessary not to return below $17,500.
A break from the bulls must not allow the return of bearish speculation that would become aggressive below $17,200, undoing all the good work done so far.
It goes hand in hand with the price trend of ETH, which in the last few hours revisits $1,440, levels abandoned on 8 November, the first of the two worst days of the last six months in the midst of the FTX exchange storm.
Ethereum also needs to confirm in the coming days the support levels that the price has been tapping in recent days.
It is $1,300 the first support level in importance and proximity that will have to prove to be well defended by the buy positions used to protect the massive derivative strategies present and growing since the beginning of the year.
If, on the contrary, the rise should continue without the need for a pause, the run will find no technical obstacles until the $1,600 area where it will be inevitable to take profits for short-term traders.