Why Bitcoin, Ethereum are set to end 2023 with a bang
- BTC’s and ETH’s price action this year was one of the best of the century.
- BTC displayed weakness, suggesting a decline below $43,000 while ETH may move toward $2,500.
Bitcoin’s [BTC] and Ethereum’s [ETH] performances in 2023 would go down as one of the best-ever in the century, a post by Santiment disclosed. At press time, BTC had been able to reclaim $43,000. ETH, on the other end, skyrocketed and changed hands at $2,380.
The crypto analysis tool, in its post, also mentioned that ETH and BTC possess the ability to reach their highest values before the year ends.
🥳📊 2023 is going down in the books as one of the best performing years of the century, accounting for multiple major sectors. #Bitcoin and #Ethereum are still within reach of breaking 1.5+ year highs, which were just established 3 weeks ago. https://t.co/JxbW5vU5Iy pic.twitter.com/aLSGX5U2Vv
— Santiment (@santimentfeed) December 27, 2023
After the glimmer, comes the party
At the beginning of the year, the crypto market was struggling to recover from the FTX collapse that plunged prices. During that time, BTC’s value was less than $17,000 while ETH traded a little above $1,200.
The rise of Bitcoin and Ethereum was fueled by different reasons.
But around the first quarter (Q1), the major reason was the collapse of some top traditional institutions in the U.S. The crash of the banks at that time triggered distrust in the institutions.
In turn, the crypto market led by Ethereum and Bitcoin gained from the liquidity withdrawn as it also affected prices in a good way.
While there were other reasons for the continuous price hike, the notable influence that has kept both coins on the green side is the optimism around a potential spot ETF. For most of the year, several firms have applied for either an Ethereum or Bitcoin ETF. In a few cases, some firms applied for both.
These applications, despite being delayed by the U.S. SEC influenced investment inflows. On many occasions, AMBCrypto disclosed hikes in money flowing into investment products connected to Bitcoin and Ethereum.
The inflows indicated that several institutions were confident in the short and long-term performance of the cryptocurrencies. So, it was not surprising that BTC put a 159% Year-To-Date (YTD) increase.
ETH also followed by climbing by 98%. Going into the last few days, there are predictions that the coins may finish the year even better.
Bulls and bears to hustle for the grand prize
For Bitcoin, the daily chart showed that there was strong support at $42,279. However, the support at the level was not a confirmation of a bullish trend.
AMBCrypto evaluated the Moving Average Convergence Divergence (MACD) which was negative.
The negative MACD indicated increasing downward momentum. Further, the Relative Strength Index (RSI) confirmed the bias as the reading fell to 54.52. If this trend continues, Bitcoin might end the year below $43,000.
However, the chart above also shows the On Balance Volume (OBV) which was rising. The rising OBV reflects positive volume pressure which could lead to higher prices.
If buying pressure increases just before the year ends, BTC might hit $45,000. If not, a downward move below $43,000 could be its next target.
Meanwhile, the ETH/USD 4-hour chart mirrored a bullish structure. On the 27th of December, ETH had surpassed the $2,290 resistance. But the coin price faced a swift rejection after it hit $2,415, suggesting that there was a cluster of accumulation at the level.
Though volatility increased, the upper band of the Bollinger Bands (BB) hit the ETH price. This suggests that the altcoin was overbought and the price may retrace further. But on looking at the Directional Movement Index (DMI), the story was different.
Realistic or not, here’s ETH’s market cap in BTC terms
At press time, the +DMI (green) was 33.92 while the -DMI (red) was 16.35. This position implied that ETH’s bullish tendencies remained pressure.
Should the Average Directional Index (ADX), colored yellow, remain above 25 while the +DMI tops the -DMI, then ETH may retest $2,415 or jump to $2,500 before the year closes.