Will the price of bitcoin soon explode?

After falling to $38,555, the price of bitcoin has risen back above $40,000. Meanwhile, Altcoins have become more active. And even though some altcoins have recorded double-digit gains, they are still far from the highs of the Bitcoin ETF price period. So, what do the current market prospects indicate?

Will the price of bitcoin increase?

Last week, it was announced that the price of bitcoin could drop to $38,500 due to a breakout of the ascending and descending parallel channel on January 12. Subsequently, the decline of the main cryptocurrency accelerated. Today, the BTC price has rebounded, rising from $38,555 to over $40,000. It is too early to celebrate because the agenda for the coming days is very busy. Moreover, macroeconomic optimism regarding rate cuts is diminishing as the USD index increases.

The price of Bitcoin (BTC) is currently in a volatile state and the $41,000 zone will be crucial in the coming hours. The advantage is that after the initial concentration of Grayscale Bitcoin Trust ETF (GBTC) sales, a balance should appear. Therefore, if sales continue to be low, the current negative sentiment could reverse.

It should also be noted that as the reserves of Bitcoin spot ETF issuers accumulate, and GBTC sales weaken, it could be easier than anticipated to reverse the recent oversold conditions. As such, it is still difficult to give a clear direction.

Should we fear a sharp fall in crypto?

The fall in the price of bitcoin unfortunately drags down other cryptocurrencies.

After its price fell below the channel on January 12th, a wave of decline in several cryptocurrencies followed. Moreover, this movement signaled the end of the bullish trend to give way to lower levels.

But all is not lost. Because if Bitcoin sellers continue to remain strong, the next support level will be $36,950. Otherwise, the horizontal support of $41,000 could be regained. This will certainly benefit the crypto universe, which primarily depends on the course of bitcoin.

Note that in a growing parallel channel, the total value of crypto reached a peak of $1.81 billion on January 11, 2024. Subsequently, the $1.61 billion support zone failed and the price left the channel.

Knowing the volatility of the crypto market and even more so that of bitcoin, it is very difficult to predict the course of future events. While it is true that Bitcoin (BTC) is showing signs of recovery, the half-empty glass perspective is also conceivable. In any case, the queen of crypto is still not done making headlines.