Bitcoin and Ethereum are two of the most popular digital assets in the world, with their prices having seen a huge increase since their inception. As more and more people become interested in cryptocurrencies, it is important to understand what factors could propel Bitcoin and Ethereum to new heights.
This article will discuss the different factors that could affect the prices of these two popular digital currencies, including fundamental and technical analysis.
In the past 24 hours, the market capitalization of the cryptocurrency market increased by 1.45% to reach $1.070 billion, while trading volume decreased by 7.81% to $79.382 billion.
Today, Bitcoin is trading at $23,220, gaining almost 1% compared to yesterday at the same time while Ethereum is now worth $1,595, or 0.1% better than yesterday.
Factors that could propel BTC and ETH to new highs
Over the coming week, cryptocurrency investors will be watching Federal Reserve interest rate figures closely American and those of the evolution of nonfarm employment in the United States.
Fed interest rates
February 1 marks an eventful week for central banks as the Federal Open Market Committee (FOMC), Bank of England (BOE) and European Central Bank (ECB) meet to announce their respective interest rate decisions. ‘interest.
The FedWatch CME tool provides a high probability (98%) that the Federal Open Market Committee will raise interest rates by 25 basis points and set the target range for the federal funds rate at 4.75%.
The difficult decision to make is whether central banks will proceed with a moderate and less aggressive rate hike. Economic performance since December has been below expectations, as evidenced by retail sales and manufacturing data. Moreover, the components of inflation were weaker than usual.
The average hourly wage saw a considerable decline while the December consumer price index (CPI) posted its first negative numbers since May 2020. Central bankers have been active over the past month and most of between them provide for a 0.25% rate hike this week and maybe another 0.25% increase in March.
Is it possible that the FOMC could point to a 0.25% rate hike this week, while deciding to pause to review cumulative hikes like the Bank of Canada did?
The interest rate decision will have a significant impact on the return of cryptocurrencies and their market price.
U.S. non-farm employment numbers
US non-farm payrolls numbers give an indication of the strength of the economy by tracking total employment outside of agriculture. This data is used by traders to decide when to buy or sell cryptocurrencies and other digital assets. The current choppy session in the crypto market may turn into a volatile market when these numbers come out next week.
After a downward-adjusted increase of 256,000 in November and topping market forecasts of 200,000, the U.S. economy added 223,000 jobs in December 2022, the lowest figure since December 2020. The employment increases employee totaled 4.5 million in 2022, an average of 375,000 per month, compared to 562,000 in 2021 and 168,000 in 2019.
The labor market is gradually returning to normal following the shock of the pandemic, and the report shows that hiring is slowing, although it remains strong.
According to Fed projections, the labor market will remain tight in 2023, but job creation will stagnate and the unemployment rate will climb to 4.6%.
Amid rising interest rates, sluggish consumer demand and a global economic slowdown, many big tech companies have already announced major layoffs.
Bitcoin price
As of today, the current Bitcoin price is around $23,220 and its 24-hour trading volume is around $17 billion. It has a market capitalization of $447 billion with a circulating supply of 19,275,881 BTC coins with a maximum supply of 21 million BTC coins.
The technical outlook for Bitcoin has not changed significantly recently as BTC/USD continues to trade in a narrow range between $22,900 and $23,400. If the value of Bitcoin drops below $22,900, we can expect that the market is trending down, potentially dropping all the way to $22,400.
If it continues to decline to $21,750, we could see an even more bearish trend, and for an extended period.
At the moment, Bitcoin’s immediate resistance level is located at $23,250. If this crypto manages to exceed this threshold, its price can peak at $23,900 and even soar to $25,150 later.
The price of Ethereum
Ethereum is currently trading at $1,595 and saw an increase of 0.10% in the last 24 hours with a total trading volume of $6.8 billion. It is ranked second on CoinMarketCap, with a live market capitalization of $195 billion.
ETH/USD traded choppy, holding just below $1,600. The close of the candles below this level is likely to increase the downward pressure on Ethereum. Additionally, Ethereum has formed a symmetrical triangular pattern, which indicates investor indecision.
The support level is present at $1,560, and a break below this level could lead ETH towards $1,500. Conversely, a bullish break above the $1625 level could quickly send ETH towards the $1680 level.
Alternative cryptocurrencies to follow
Cryptonews Reviewed top 10 cryptocurrencies for 2023. If you are looking for a higher potential investment opportunity, there are many other projects worth considering.
Disclaimer: This linked article presents the views of crypto industry players and is not part of the editorial content of Cryptonews.com.
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