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Bitcoin price is off to a slow start in 2023 as the cryptocurrency continues to stall and move sideways around current levels. Many experts believe that BTC has seen the worst of the recent bearish cycle and is gearing up for some gains.
At the time of writing, Bitcoin price is trading at $16,700 with sideways movement over the last 24 hours and the previous seven days. Low trading volume and low activity due to the holiday contributed to the current price action.
Bitcoin price is nearing a bottom, but profits remain elusive
According to analyst Caleb Franzen, the Bitcoin price registered another indication of a bottom. Franzen and others tracked down the clues that could support a bullish position for BTC, and the Heikin Ashi printed a positive signal.
The Heikin Ashi is a technique to visualize price action and create candlestick charts to gauge trends in a market. Franzen claims that Bitcoin price printed its 13th consecutive monthly Heikin Ashi on December 22.
The last time BTC saw a similar trend was at the end of the bear markets of 2018 and 2015. This data supports positive outlook for Bitcoin price and indicates bullish potential in the coming months. The analyst stated:
Each red stripe is longer than the last and we are currently building #14 for January ’23. Historically, a green month candle after 5+ red month candles meant the end of any bear market.
As mentioned, Franzen and other statistics point to Bitcoin forming a bottom at its current levels. Crypto exchange Coinbase claims that 50% of BTC investors suffer losses.
In previous bear cycles, this metric reaching 50% coincided with a “sold basis for a macro market bottom”, the report from Coinbase claims:
These represent key inflection points for BTC performance ahead of subsequent periods of price appreciation. We believe this metric provides important insights into current cycle positioning.
Bitcoin price needs to clear a $14 million sell wall at $17,000 to take a first step in this direction. Additional data from Material Indicators claims that this level represents a significant hurdle for the cryptocurrency in the near term.
#FireCharts shows about $14 million in demand liquidity, blocking #Bitcoin of a green Weekly candle nearby. pic.twitter.com/f5kfVtOd0R
— Material Indicators (@MI_Algos) January 1, 2023
What could spark a new Bitcoin rally
Like NewsBTC reported, history is on the side of the bears. For the past two years and since 2015, Bitcoin price had been trading down in January, recording double-digit losses.
The start of a new year, low liquidity and trading activity contribute to this historic pattern. The elements for another red January are in place, but the cryptocurrency could surprise if macro conditions turn for the better.
The US Federal Reserve (Fed) is likely to continue with its rate hike program, but representatives of financial institutions have suggested a shift in monetary policy. According to the trading desk QCP Capitalif the Fed rushes in and changes its approach, Bitcoin price will benefit.