Bitcoin price struggles to overcome $23,000

Crypto markets were overall steady on Tuesday, with significant cryptocurrencies struggling to hold onto last week’s gains. Global cryptocurrency market capitalization has started to recover this month and remains above $1 trillion. Crypto bulls are hoping that the recent cryptocurrency selloff has passed and that market confidence in the industry will be restored.

Risk sentiment remains uncertain and a trend has yet to form in crypto markets. Global recession concerns keep risk sentiment down, although cooling inflation has brought optimism for economic recovery. 

US PPI data last week fell below expectations, reducing Fed rate hike expectations. PPI declined by 0.5% in December, versus estimates of a 0.1% drop. Headline inflation also dropped to 6.5% year-on-year in December from 7.1% in November. US inflation is cooling, which may give the Federal Reserve some leeway toward scaling back its interest rate increases.

Even though inflation rates remain high, cooling price pressures have reduced rate hike expectations, providing support for riskier assets. The Fed and other central banks are starting to scale back their aggressive rate hiking, raising hopes of a reversal in cryptocurrencies’ downfall. Crypto markets exhibit low volatility, as market participants await the Fed monetary policy meeting next week.

Bitcoin price struggled to overcome the $23,000 level on Tuesday. If the BTC price declines, support can be found near $17,930, while resistance may be encountered near $23,300. 

Ethereum price edged lower on Tuesday, dropping to the $1,610 level. If Ethereum's price declines, it may encounter support near $1,370, while if it increases, resistance may be encountered near $1,670.

BTC/USD 1h Chart

ETH/USD 1h Chart

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Written by:
Myrsini Giannouli

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