The surge in crypto prices in 2023 has sparked increasing optimism, fueled by expectations of the approval of a spot Bitcoin ETF, the upcoming BTC halving, and a generally positive market sentiment. Despite a cautious start to the year, events throughout 2023, including notable price increases in Bitcoin, Ethereum, Solana, and various altcoins, have surprised market participants and hinted at the potential for a bull market in 2024. The global crypto market cap currently stands at $1.69 trillion, reflecting a remarkable 112% increase over the last 12 months. Notably, Bitcoin and Ether have experienced substantial gains of 154% and 93%, respectively. Altcoins such as Solana and Avalanche have demonstrated even more significant growth, with increases of 880% and 250%, highlighting the heightened volatility in the crypto market. Key factors contributing to the surge in crypto prices include growing optimism surrounding the potential approval of a spot Bitcoin ETF, the successful Shanghai upgrade for the Ethereum network, and the anticipation of the Bitcoin halving event, scheduled within the next 180 days.
Bitcoin (BTC), once considered a niche digital asset, has now climbed to become the 16th largest currency globally when measured by market capitalization against various fiat currencies. However, on December 28, it experienced another day of losses as bulls encountered persistent resistance, highlighting the challenges faced in breaking out of a well-established trading range that has persisted for over a week. Several factors contributed to the hurdles on the upside, including profit-taking activities and elevated funding rates, prompting analysts to express concerns about the potential outcomes in the near future. The bullish outlook for Bitcoin is substantiated by ongoing on-chain activity. On Wednesday, more than 28,000 BTC, valued at $1.19 billion, departed from centralised exchanges. This marked the most significant single-day outflow in terms of BTC since December 14, 2022, based on available data. Typically, net outflows from exchanges are interpreted as an indication that investors are opting to hold coins in direct custody or pursuing a long-term holding strategy.
ETH is currently undergoing a resurgence after a period of underperformance marked by a decline in both its price and comparative value to Bitcoin. The recent down trend in ETH USD led many investors to view Ethereum as an underbought asset, with some labelling it a ‘beta play,’ suggesting it was a less volatile and less rewarding investment compared to its peers. However, this perception is being challenged as Ethereum exhibits strength and growth potential, with its price gradually rising against both USD and other cryptocurrencies. As Ethereum gains momentum, its competitor Solana is observed to be shedding a significant portion of its previously accumulated value, underscoring the inherent volatility of crypto markets. Recent data indicates Solana’s daily DEX volume has surpassed $1.447 billion, with a weekly volume exceeding $10.786 billion. Notably, Solana’s weekly DEX volume now exceeds Ethereum’s reported $9.604 billion in weekly value.”
Technical Outlook:
Bitcoin:
BITCOIN after giving a range breakout above $28,500 witnessed a sharp rally and the prices surged up to $44,700. The asset faced stiff resistance at higher levels and saw some profit booking. The prices corrected almost by 10% and dropped to $40,222. Post this move, BTC is consolidating and trading in a range from $44,500 to $41,500. The asset has a strong support at $40,000 whereas $44,500 and $48,000 will act as armstrong resistance. To further rally BTC needs to break, close and sustain above the resistance of $44,500.
Ethereum:
ETH was facing stiff resistance at the previous high of $2,146. However, the bulls finally were able to break the long held resistance and the prices surged up to $2,455. The asset is facing stiff resistance at the key resistance level of $2,400 (Horizontal Trendline) and is not able to give a daily closing above that. The longer upper shadow around $2,400 indicates selling around these levels. Hence, to further rally, ETH needs to close and sustain above $2,400 whereas $2,150 will act as a strong support for the asset.
Binance Coin:
BNB was facing multiple resistance at $255. The bulls finally gave a breakout above the resistance and the prices rallied up to $338. The asset has a strong resistance at $350 and we may expect some consolidation or profit booking from these levels. $300 will act as a strong support for the asset.
Weekly Snapshot:
| USD ($) | 21 Dec 23 | 28 Dec 23 | Previous Week | Current Week | |||
| Close | Close | % Change | High | Low | High | Low | |
| BTC | $43,869 | $42,628 | -2.83% | $44,276 | $40,530 | $44,368 | $41,676 |
| ETH | $2,240 | $2,348 | 4.82% | $2,317 | $2,120 | $2,445 | $2,180 |
| BNB | $271.25 | $323.60 | 19.30% | $274.44 | $232.75 | $337.43 | $262.49 |
| Crypto | 1w – % Vol. Change (Global) |
| BitCoin (BTC) | 2.24% |
| Ethereum (ETH) | 15.99% |
| Binance Coin (BNB) | 41.07% |
| Resistance 2 | $48,000 | $2,750 | $1.15 | $350 |
|---|---|---|---|---|
| Resistance 1 | $44,500 | $2,400 | $1 | $338 |
| USD | BTC | ETH | Matic | BNB |
| Support 1 | $40,000 | $2,150 | $0.75 | $300 |
| Support 2 | $36,000 | $1,900 | $0.55 | $255 |
Market Updates:
- Chinese authorities are moving to crack down on the use of cryptocurrencies like Tether in foreign exchange trading more than two years after enforcing a major crypto ban.
- On Dec. 28, Vitalik Buterin proposed a method of reducing the number of signatures that validators are required to make to keep the network running, thus reducing load.
- ARK Invest has become the first to file its final Form S-1 amendment for its proposed spot Bitcoin exchange-traded fund (ETF) ahead of a reported United States Securities and Exchange Commission (SEC)-imposed deadline understood as a requirement to be considered in the first wave of decisions in January 2024.
- India’s Financial Intelligence Unit is requesting to block the URLs of Binance, KuCoin, Huobi, Kraken, Gate.io, Bittrex, Bitstamp, MEXC Global and Bitfinex.
