Bitcoin and Ethereum prices are in a strong recovery

Today, Bitcoin and Ethereum prices are experiencing a strong recovery.

After the difficulties witnessed in recent days, today there seems to be a wave of optimism in the digital currency markets, although it cannot be ruled out that it is just a passing thing.

Bitcoin price trend

After Bitcoin price reached an all-time high on December 17, above $108,000, it was unable to maintain the psychological threshold of $100,000.

The fact is that she tried on January 6th, but within a day she immediately went down.

The problem is that as of December 18, the US dollar started to strengthen, weakening Bitcoin, since the price trend… Bitcoin In the medium/long term it tends to be inversely related to the dollar index.

On December 18, the dollar index suddenly broke through the resistance level of 108 points, and since then it has risen further, briefly reaching 110 points yesterday.

Just yesterday, in fact, was the worst day for me Bitcoin Since hitting all-time highs shortly after mid-December.

If on January 7 the price of BTC had already fallen below $97,000, until yesterday it remained around $93,000, despite its short drop below $92,000 on January 9.

However, yesterday, it not only fell below $91,000, it briefly fell below $90,000.

Yesterday’s point is the lowest level that the price of Bitcoin has reached since December 17 onwards.

Ethereum price trend

price Ethereum And I’ve done worse.

If we take as a reference the ratio between the market capitalization of Bitcoin and that of Ethereum, a month ago it was less than 4.3 times, but it was already rising.

However, on January 5th, it was just above 4.4 times, which is right in line with where it was a month ago.

However, starting from January 6, the price trend of Ethereum began to decline significantly compared to Bitcoin, so much so that the ratio between the two market caps rose to 4.7 times already on January 8, when Bitcoin was below $97,000 and Ethereum was below $3,400.

Then things got worse from this point of view even more, until it reached the extreme peak of this period that was reached just yesterday by more than 5 times, with Bitcoin falling to $92,000 and Ethereum falling even below $3,000.

Compared to last month, the price of Bitcoin lost 4%, but the price of Ethereum lost 11%.

However, we must remember that often during difficult stages of the disease Crypto marketsaltcoins, including Ethereum, are outperforming Bitcoin.

Just keep in mind that in the past 30 days, the total market cap of all altcoins combined has dropped from $1,600 to $1,400 billion.

Bitcoin and Ethereum prices rebound

However, a wave of optimism seems to have reached both bull and bear markets today.

Bitcoin is back at $97,000, while Ethereum is back at $3,200.

However, the market-cap ratio is still high (4.9), and this suggests that if a rebound occurs, Ethereum could outperform Bitcoin for a certain period, although this has not happened yet.

It seems that today’s recovery can only be explained by advancing optimism about what might happen in the cryptocurrency markets in the coming days, or in the coming weeks.

In fact, in the coming days, the dollar index is expected to fall, which could lead to a rise in the price of Bitcoin, which in turn could bring with it Ethereum and altcoins.

Moreover, often, at stages like this at the end of January, an upward drive begins, and many people seem to be hoping that this will happen.

However, there are also those who claim that today’s recovery could simply be a bull trap, meaning a trap for those who open long positions, perhaps using leverage.

All eyes on tomorrow

Tomorrow, Wednesday, January 15, 2025, data related to inflation in the United States for the month of December will be published.

The key data, which may have consequences for the Fed’s monetary policies, are those related to core inflation.

Markets expect tomorrow’s data to be in line with December’s data: 3.3%.

On the other hand, since September, annual core inflation in the US has been stuck at 3.3%, so it is very easy to predict that it may have remained unchanged in December.

However, it is not certain that the data released tomorrow will be exactly 3.3%.

If it rises, even slightly, markets may react poorly, because they may begin to perceive that the Fed may have to make its current monetary policy more restrictive, which has already been restrictive for several months now.

On the other hand, after three consecutive months of recession from this point of view, if the December number falls, the markets may react well, because at that point it will become more likely that the Fed will release its monetary decision. Less restrictive policy.

Today, it seems as if the markets are daring to anticipate this second scenario in particular, which does not seem particularly likely in light of the current situation. If they are wrong, an important correction could occur tomorrow.