BTC Continues Strong Consolidation. Will it Hold?

Neither this post nor any other on cryptofal.com should be taken as financial advice. It is not.

BTC 4-hour candle chart, approximately 9:25 am ET, 1/3/22

Bitcoin is having a fairly strong period of consolidation at this current support level.

The support range above $45k has been held during much of this past month or so. The closer it gets to $45k, the stronger the support tends to be. Volume has mostly settled as it is starting to coil more tightly over the past few days. This type of consolidation pattern is not a bad thing either. The longer it holds in this area, the stronger the support tends to be. However, if there is a large influx of sell-side pressure the support could struggle to hold. It should be noted that Covid cases are on the rise globally, so if fiat markets are affected significantly it wouldn’t be too surprising to see crypto markets be affected as well.

The MFI is moving fairly neutrally after starting a strong uptrend last week. The MACD is looking like it could swing upward some more, however, it has yet to have a significant influence on price action.

The overall cryptocurrency market cap is currently at around $2.258 trillion. It has been cycling between $2.35 and $2.15 trillion over the past couple of weeks. The overall volume is around $84 billion at the time of posting. BTC dominance has dipped down to 39.5% and ETH dominance is holding fairly steady at 20.2%. Altcoins are continuing to take larger inflows of money as BTC consolidates.

Ethereum is attempting a bit more of a definitive uptrend than BTC, but, it is still moving relatively in the same range. The MACD has also swung upward and could continue to swing further, however it should be noted that the MFI is now bordering overbought territory on ETH’s 4-hour candle chart. While ETH dominance is holding fairly steady, BTC dominance is dipping so it isn’t too surprising to see ETH attempting more of a slight uptrend with the rest of altcoins while BTC coils a bit.