Passing Back to Flat, Analysts Say Crypto Still in Bullish Position

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The performance of the cryptocurrency market heading into the fourth week of January 2023 is again sideways or flat and tending to correction. However, many indicators are pointing to the crypto market still being in a bullish position.

The slight decrease in crypto prices on Friday, January 27, 2023 is considered a temporary correction, which is common. This is because investors from both bullish and bearish camps are studying the latest economic data on the United States' gross domestic product (GDP) which increased by 2.9% in the fourth quarter of 2023.

The trading volume of BTC and ETH is still slightly above average. Investors are currently analyzing and calculating the impact of the latest economic data on the crypto market, which is causing a slight halt in accumulation," said the research team at Tokocrypto in a daily analysis received by, Friday (27/1/2023).

The research team at Tokocrypto explained that, seen from other indicators, the US stock index is also performing well, with the Nasdaq and S&P 500 experiencing an increase and likely to continue to affect the price of Bitcoin. The US dollar index (DXY) is also still at 101, approaching the lowest level in the last eight months.

Issue of Interest Rate Increase in the US

photo: Unsplash/Kanchanara

The sentiment in the crypto market remains bullish as seen by the increase in the Bitcoin Fear and Greed Index, which has returned to the "Greed" level. The Fear and Greed Index closed at 55, up one point from the Thursday close.

One possible reason for investors to again withdraw their investments is the issue of interest rate increases in the US by the Federal Reserve (The Fed). Investors need to remain vigilant about price fluctuations as the Federal Open Market Committee (FOMC) meeting will be held in five days, which is a crucial moment for determining the movement of the world economy.

The Fed's Decision is Determined


The FOMC meeting will take place from January 31st to February 1st, 2023. It is likely that The Fed will raise interest rates again, but not too aggressively with a target increase of 25 basis points.

The prospects for the crypto market in February will be determined after the FOMC meeting and The Fed's attitude. If The Fed raises interest rates by 0.25 percent to 4.75 percent, it will be potentially positive for the crypto market, the price of Bitcoin could still hold at around USD 22,000 or equivalent to Rp 329 to USD 24,000 or equivalent to Rp 359 million (assuming an exchange rate of Rp 14,977 per US dollar).

However, if there is a surprise with an increase of more than 0.25 percent, then the price of BTC is likely to correct to the area of USD 20,600 or equivalent to Rp 308 million to USD 21,200 or equivalent to Rp 317 million, and worst case scenario to the area of USD 18,800 or equivalent to Rp 281 million,” concludes the analyst team at Tokocrypto.

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