Altcoins grind higher as Bitcoin bulls fail to push above $17,000
(Kitco News) – Little has changed in the crypto market over the past 24 hours as the majority of the top tokens continue to trade within a tight range while investors remain sidelined due to concerns related to the ongoing spat between the cryptocurrency exchange Gemini and the Digital Currency Group (DCG).
With the DCG being one of the largest venture capital funds in the ecosystem, the prospect of shady fund management and the potential for another high-profile bankruptcy is causing crypto investors to take a wait-and-see approach before putting more money into the market.
The traditional markets also saw another day of sideways trading as the release of the minutes from the Fed’s December policy meeting showed that officials from the central bank have no intention of cutting interest rates in 2023. The hawkish report reversed the gains achieved in the morning session but a late push into the close helped lift the S&P, Dow and Nasdaq into the green, closing up 0.75%, 0.40%, and 0.69% respectively.
Data from TradingView shows that Bitcoin (BTC) bulls attempted to push the top crypto above resistance at $17,000 near midday but were soundly rejected by bears, which resulted in Bitcoin’s price pulling back to support at $16,800.
BTC/USD 4-hour chart. Source: TradingView
Kitco’s veteran technical analyst Jim Wyckoff noted the continued sideways trading in his morning Bitcoin update, saying that “While trading remains sideways and choppy overall, the bulls have gained some momentum this week,” adding that “Traders are waiting for a spark to ignite more volatile price action.”
The stagnant market conditions were also highlighted in the most recent market report from Arcane Research, which noted that “BTC and ETH have experienced slight declines in the previous seven days but trade in a very stable price range.”
According to the analysts, “The current stale price action is reflected in BTC’s volatility, which has slumbered toward rare lows, evident by the 7-day volatility in BTC, reaching lows not seen since July 2020. The dwindling volatility is accompanied by spot volumes drying up and the futures market reigning in a flat regime.”
Overall, the prevailing consensus is that the market will continue to trade sideways for the foreseeable future, with market analyst Michaël van de Poppe pointing to the range between $16,500 and $16,600 as a possible entry point for a long position.
Good old Powell with FOMC minutes moving the markets again.
Run up before the FOMC takes place, then correction after.
Run up on #Bitcoin towards crucial resistance, at $17K, which we marked earlier.
Probably more consolidation.
Looking for longs around $16.5-16.6K.
— Michaël van de Poppe (@CryptoMichNL) January 4, 2023
Altcoins in the green
On the whole, the altcoin market trended positive on Wednesday as the majority of tokens saw gains ranging from 1-6%, which came as a pleasant surprise to many crypto investors.
Daily cryptocurrency market performance. Source: Coin360
The top performers on the day included a breakout performance by XYO (XYO), which posted a gain of 83.4% to trade at $0.0088, followed by a 19.84% gain for Ethereum Classic (ETC) and a 19.05% increase for Synapse (SYN).
The overall cryptocurrency market cap now stands at $817 billion, and Bitcoin’s dominance rate is 39.6%.
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