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Bitcoin briefly Touches $24,000, Retraces Back a Recent Support Level

The increase coincided with a rise in overall tech stock prices and a decline in the US dollar currency index (DXY) value and rates on US Treasury securities.

Photo by David Shares / Unsplash

Following the momentum it gained at the beginning of the year, the price of Bitcoin surged through the $24,000 level late Wednesday night.

The increase coincided with a rise in overall tech stock prices and a decline in the US dollar currency index (DXY) value and rates on US Treasury securities.

The bitcoin price has remained highly tied to the equities heavily weighted in technology. The most recent uptick in the benchmark interest rate occurred when the Federal Reserve decided to increase it by 25 basis points. The Chairman of the Federal Reserve, Jerome Powell, also announced that the deflation process had begun.

As a consequence of this, many investors interpreted the news as signaling a bearish position. As a result, they increased the amount of risk they were willing to take in the market, expecting inflation to begin to decline.

On the other hand, Yuya Hasegawa, an expert at the crypto currency exchange Bitbank, believes that the crypto currency market still needs to prepare for a surge of this magnitude.

Hasegawa observed that the inflation rate was still relatively high even though a deflation process had begun. Additionally, he indicated that the FEC would need additional data before concluding that inflation is getting close to their objective of 2%.

Could We Expect the Full Recovery of Bitcoin?

Although it is possible that Bitcoin may not surpass its former all-time high of $69,000 before the end of 2023, some investors think that the crypto currency market has reached its lowest point and will begin to rebound by the end of the year.

For instance, Anthony Scaramucci, founder of SkyBridge Capital, believes that the price of bitcoin might reach between $50,000 and $100,000 within the next two to three years. According to Scaramucci, broad technology usage might be the driving force for such an increase.

Since the start of 2023, the price of Bitcoin has increased by 40 percent. Additionally, January 2018 has been Bitcoin's greatest month since January 2013. Despite this, institutional investors are continuing to keep a cautious eye on the market because they are concerned about the possibility of a recession.

Worrying Factors For Bitcoin

Despite promising signals of recovery from the majority of indices, the worry that the global economy is entering a recession has extinguished any prospects of a swift rise.

Bill Tai, involved in venture finance, believes that the price of bitcoin might drop to $12,000 before it begins to rise again. This is because it is anticipated that the cost of Bitcoin would be influenced in the short term by broad macro economic factors such as the rate of inflation.

No matter the reason, the latest increase in the price of bitcoin is a positive indication for the crypto currency sector as a whole. According to Tradingview, the cost of the token was estimated to be $23,600 at the time this article was written.

Bitcoin Showing a Good Retest of recent support levels. Source: TV(1.1)