Bitcoin once again made a new high in five months by surging past the $23k range before retracing back to $22,760 at press time.
The largest crypto by market capitalization was recently trading above $22,750, for the last 24 hours and was up by more than 8% during the past week.
This dominant coin witnessed a buoyant year, rising by nearly 37% and not succumbing to various crypto industry headwinds.
Joe DiPasquale, CEO of cryptocurrency fund manager BitBull Capital stated, “a long consolidation phase that saw shorts accumulate” in the most recent Genesis Global Holdco LLC application for Chapter 11 bankruptcy protection.
He also added that the surge was usual for first quarters.
“The market has risen, partially fueled the short squeeze,” DiPasquale wrote, adding warily that “Bitcoin and several altcoins are overheated and due for a correction. “We wouldn’t be surprised to see Bitcoin testing $20,000 in the coming days.”
“For the week ahead, market participants should be mindful of downside risks and potentially seek to take profits.”
Apart from that, Bitcoin has maintained its dominant position among other global assets outperforming major asset classes in 2023 amid a more promising macro picture.
In a recent poll conducted by the University of Michigan, it was found that the US short-term inflation decreased in early January to the lowest level in over two years, boosting consumer confidence more than anticipated.
Additionally, with the continued cooling of prices, the Federal Reserve is on pace to pivot to smaller interest-rate hikes, though it’s expected to keep raising rates until pressures show more definite indications of weakening.
Bitcoin Will Reach $35k To $44k In 2023
Even bulls, though, showed some reservation. Sean Farrell, head of Fundstrat’s digital asset strategy, predicted that Bitcoin will increase from $35k to $44k this year and that Ether will reach $2,400 to $3,200.
However, he cautioned that there may be market volatility because of problems like the ongoing turbulence at Digital Currency Group.
“Despite our view that the absolute lows for the majors are in, we still believe there are some near-term risks to remain cognizant of,” Farrell wrote in a note on 21 Jan.
“These include additional fallout from DCG, one more swipe at risk assets at the next FOMC meeting, and the fact that despite the recent rally, we are still amidst what we would consider an on-chain bear market.”