Bitcoin trades near $23k as the crypto market rally extends into a third week
(Kitco News) - Crypto prices were once again on the move higher in trading on Monday as the rally that began on Jan. 9 is now entering its third week, showing no signs of slowing down amid a backdrop of rising optimism.
The stock market, likewise, extended its gains from the week prior as investors prepared for a busy schedule of corporate earning announcements. At the close of markets in the U.S., the S&P, Dow and Nasdaq all finished higher, up 1.19%, 0.76%, and 2.01%, respectively.
Data from TradingView shows that Bitcoin (BTC) bulls defended support at $22,600 throughout the morning session and managed to push its price to a daily high of $23,181 in the afternoon before pulling back to support near $23,000.
BTC/USD 4-hour chart. Source: TradingView
The move higher established a new four-month high, according to Kitco senior technical analyst Jim Wyckoff, who indicated that Bitcoin bulls now “have the solid overall near-term technical advantage amid a steep price uptrend in place on the daily bar chart.”
This “suggests more price upside is likely in the near term,” Wyckoff concluded.
The move higher in BTC came after it was in consolidation for a period of five days, but care should be taken moving forward, according to analysts at Eight Global, as while its price made a higher high, “the RSI got stuck at a lower high, effectively developing a negative divergence which could point to a potential correction coming soon.”
The area from $22,400 to $22,500 is the first level of support below the current price action, said Eight Global analysts. “If daily candles keep closing above this area while the price is consolidating for a while, we could see a quick liquidity grab to the upside before the potential correction, despite the developing negative divergence,” the analysts warned.
For those who prefer a more aggressive approach to trading, “$22,400 - $22,500 is the area to look for longs during consolidation, with an initial target of around $24,000, stop loss around $22,200, or invalidation at candle close below $22,250,” Eight Global said.
In the event that a deeper correction occurs, a defensive approach would be to look for longs in the range between $21,300 - $21,700, with an initial target of around $23,500 - $24,000. If $21,300 fails to hold as support, “look for shorts during a bearish retest of the $20,800 - $21,300 area, “ targeting the 0.236 fib level (~$19,500) and the $18,600 area,” the analysts said.
Double-digit Altcoin gains
The uptrend in the altcoin market also extended on Monday, with all but a handful of tokens in the top 200 in the green on the day, led by a 33.7% gain for Threshold (T).
Daily cryptocurrency market performance. Source: Coin360
Other notable altcoin gainers on Monday include a 32.07% gain for Keep Network (KEEP), a 25.41% increase for Ribbon Finance (RBN), and a 25.29 gain for Hooked Protocol (HOOK).
The overall cryptocurrency market cap now stands at $1.05 trillion, and Bitcoin’s dominance rate is 42.1%.