3 Potential Catalysts to Reverse the Collapse in Bitcoin and Altcoin Prices

The price of Bitcoin fell to $90,000 on January 13 as recent weakness in the cryptocurrency market continued.

Bitcoin (Bitcoin) is down 16% from its December high and hovering near its lowest point since November 19. Other altcoins like Solana (Sol) and Cardano (Ada) also continued to decline.

The ongoing collapse of cryptocurrencies has been largely attributed to growing expectations that the Federal Reserve will adopt a more hawkish stance this year. These expectations increased after the United States published strong data on non-farm payrolls on Friday.

The unemployment rate fell to 4.1% in December as the economy added more than 256,000 jobs, data showed. These numbers led to a decline in stock prices Government bond yields rise.

The first potential catalyst for Bitcoin’s recovery is upcoming US consumer inflation data, scheduled for release on Wednesday. Economists expect the data to show that inflation rose from 2.7% in November to 2.9% in December. Core inflation, which excludes volatile food and energy prices, is expected to remain at 3.3%.

Bitcoin and other altcoins may rebound if inflation numbers come in lower than expected. For example, if the headline and core CPI fall to 2.5% and 3.0% respectively, this could trigger a rebound in cryptocurrency prices.

Another major factor to watch is the upcoming inauguration of Donald Trump, which may impact the cryptocurrency market. Trump campaigned on making the United States the global cryptocurrency capital and has already made some moves toward that goal. eye Paul Atkins is the new Chairman of the Securities and Exchange Commission It began forming a committee of cryptocurrency experts.

Therefore, his next inauguration and Gary Gensler resignation It may lead to hype in the crypto industry. All of this is happening as companies like MicroStrategy and Semler Scientific continue to buy Bitcoin.

Bitcoin price technical

Another potential catalyst for Bitcoin price is the technical setup. BTC is holding at a key support level of $90,100, a point that has not been breached since December. This indicates that bears are reluctant to place short positions below this level.

In addition, the Accumulation and Distribution Index is rising, indicating continued accumulation.

While the $90,100 support level forms the neckline of a bearish head and shoulders pattern, Bitcoin is likely to bounce back this week. Historical data also shows that Bitcoin tends to rebound after Monday’s decline.