(Kitco News) - The cryptocurrency market continued to strengthen in trading on Thursday as recent economic data shows evidence of a deceleration in inflation over the past few months, which contributed to yesterday’s decision by the Fed to only raise interest rates by 25 basis points.
Tech stocks climbed higher after a round of positive earnings from tech companies, which helped the technology-heavy Nasdaq Composite finish the day up 3.25%, while the S&P put on a gain of 1.47% and the Dow closed down 0.12%.
Data from TradingView shows that an early morning push by Bitcoin (BTC) bulls elevated the top crypto to a daily high of $24,245, but they appear to have exhausted their momentum as BTC has since pulled back to support near $23,600 with the potential to drift even lower.
BTC/USD 4-hour chart. Source: TradingView
Kitco senior technical analyst Jim Wyckoff noted that the early morning surge saw BTC hit a six-month high, giving Bitcoin bulls “the solid overall near-term technical advantage as a price uptrend is firmly in place on the daily bar chart.”
According to Wyckoff, “The bulls have the power to push prices still higher in the near term.”
As for what Bitcoin needs to do in order to overcome the larger macro downtrend in the month ahead, crypto analyst Rekt Capital posted the following tweet highlighting the need to climb above $26,500 to successfully initiate an uptrend.
#BTC would need to break beyond ~$26500 to break the Macro Downtrend this Feb
— Rekt Capital (@rektcapital) February 2, 2023
But because of the slanting nature of the downtrend, it will be easier to break it next month
The price point that would represent the Macro Downtrend next month is ~$24600$BTC #Crypto #Bitcoin pic.twitter.com/kzOA315bv9
A follow-up tweet from Rekt Capital noted that historically, the month before a Bitcoin macro downtrend breakout “tends to be slow.”
“If history repeats, there's a chance February won't be exciting for BTC,” Rekt Capital wrote. “But March could be as Macro Downtrend would be tested. March could be the Macro Downtrend breakout month.”
And for crypto trader and host of The Wolf of All Streets podcast Scott Melker, the price level to keep an eye on that invalidates the bear thesis and signals the start of a bull market is $25,121.
$25,212.
— The Wolf Of All Streets (@scottmelker) February 2, 2023
That’s the line for $BTC.
A break above would be the first higher high since $69,000 and would technically invalidate the bear thesis.
Altcoin win-streak continues
The altcoin market extended its winning streak for another day, with the majority of tokens in the top 200 in the green on Thursday as the total market cap continues to creep higher.
Daily cryptocurrency market performance. Source: Coin360
The biggest gainer on the day was Conflux (CFX), which climbed 35.13% to a price of $0.078, followed by a 22.87% increase for EthereumPoW (ETHW), and an 18.45% gain for Illuvium (ILV).
The overall cryptocurrency market cap now stands at $1.091 trillion, and Bitcoin’s dominance rate is 42.1%.
