Cryptocurrencies, which started the year on a rapid rise, turned into something of a sideways movement this week compared to the previous two weeks.
After Bitcoin entered the $20,000 range at the end of last week, there have been attacks towards the $21,000 level over the past 7 days, but we have yet to see a daily close above the $21,300-21,400 range, which is the last peak it reached in November. While there was similar momentum in the Ethereum market, the largest altcoin has a heavier sideways view in favor of the sellers this week. While Ethereum saw weaker moves towards the $1,600 level during the week, the $1,500 support is still strong for the time being and has withstood the selling pressure.
Bolstered by last week’s US CPI data, the cryptocurrency market has seen sharply accelerated gains. This week, once again, the view was that the impact of the CPI data was limited on the market, after the retail sales announced by the US came in lower than expected. Accordingly, we have seen that risk appetite has decreased somewhat.
On the other hand, some negativity witnessed in the cryptocurrency industry this week also dampened the positive mood. The first thing that came to mind was the unease in the market when the US Department of Justice announced that it was going to issue an important statement. However, the announcement of the takeover of the Hong Kong-based Russian cryptocurrency exchange, as a continuation of the ongoing operation since September, has eased the anxiety a bit. However, the warning letters from the US Department of Justice were striking.
Late yesterday, the news of the bankruptcy of Genesis, one of the largest companies in the cryptocurrency industry, had a short-term shock effect. However, for now, the negative effects of the bankruptcy news appear to be limited.
Bitcoin is still stuck at a critical resistance level
It is noticeable that Bitcoin is struggling to overcome the most important resistance area at the $21,300 average this week. Bitcoin buyers, who had cleared all the resistance areas up to this one, reduced their activity to the $21,000 range.
The current situation may continue as the flat shape formed after the sharp and accelerated rise may trigger a wave of profit-taking in the market. In case of a possible correction, the price is currently targeting the nearest support area between
$20,500-20,000. If further decline occurs, the $19,200 and $18,500 levels could reappear.