According to Cointelegraph: The third week of January sees Bitcoin (BTC) still holding above the $40,000 mark after a tumultuous start to the year, with speculations about its next move abounding. The introduction of the first spot Bitcoin ETFs in the U.S. seems to have introduced significant volatility to the BTC market, reflected in the billion-dollar losses borne by speculative traders.
Two narratives dominate the current discourse: while some see the post-ETF dip as a healthy retest of support, others foresee the preceding local top as being dominant for a lengthy period. However, with potential macro triggers set to cool down before the next Federal Reserve interest rate decision at the end of the month, the market may have up to two weeks to decipher future moves.
Bitcoin has seen significant pressure following the peak of $49,000 reached during the ETF launch day, with the rapid descent not allowing sellers to fully test the $40,000 mark. Currently settling around the $43,000 mark after a minor bounce-back, Bitcoin's trajectory remains uncertain, with early signs indicating potential retesting of resistance.
Furthermore, speculation-induced panic selling saw nearly $5 billion dumped in a day. Short-term holders appear to have reacted strongly to the volatility, offloading considerable amounts of Bitcoin at a loss, in contrast to the relative quiescence amongst long-term holders.
Meanwhile, cryptocurrency Ethereum (ETH) appears to be gaining traction as Bitcoin navigates this turbulent period. ETH/BTC experienced significant gains while ETH/USD hit its highest levels since mid-2022. However, analysts caution about potential risks due to the sharp increase in open interest.
The ongoing course of BTC markets and their interplay with auxiliary narratives, such as the Ethereum market movement and macroeconomic triggers, will likely shape the cryptocurrency landscape in the week to come.
