While bitcoin (BTC) has experienced a sharp price rise to kick off the new year, many industry insiders are not convinced that the cryptocurrency will continue its upward trajectory, at least in the short to medium term.
The impressive price increase, which saw BTC experience 14 days of consecutive price increases earlier this month, he has asked many to consider whether the rise marks a significant "breakthrough" or is indicative of a "bull trap."
Speaking to Cointelegraph on Jan. 23, James Edwards, a cryptocurrency analyst at Australian fintech firm Finder, said the case for a โbull trapโ is stronger, warning that the recent rise could be โshort-lived.โ .
He stated that while the price of BTC rose over the weekend, the NASDAQ Composite and S&P 500 also made similar rallies:
โThis suggests to me that the cryptocurrency rally is not unique and is instead part of a broader market improvement as inflation numbers plateau and risk appetite appears to return to investments. So Bitcoin is simply enjoying the effects of the positive sentiment that originated elsewhere. This is likely to be short-lived."
Edwards added that cryptocurrency markets still have some โsignificant hurdles to clear before a new bull market can begin.โ
Among those obstacles, he mentioned including the continuing consequences on The FTX Collapse and the recent presentation of Chapter 11 by Genesis it's january 19
โAs such, we are going to see more liquidations and staff reductions as crypto companies adjust their balance sheets and dump tokens on the market to cover debt and try to stay afloat,โ he explained.
In a statement to Cointelegraph, Bloomberg Intelligence senior commodity strategist Mike McGlone also had no confidence in BTC's price trajectory, citing recession-like macroeconomic conditions as too big a barrier for BTC to overcome.
โWith the world tipping into recession and most central banks tightening, I believe the macroeconomic ebbing tide remains the main drag on Bitcoin and crypto prices.โ
The sentiment was also shared among some on Crypto Twitter, with cryptocurrency analyst and swing trader "Capo of Crypto" telling his 710,000 Twitter followers on Jan. 21 that pushing BTC past resistance looks like "the bull trap." biggest" I have ever seen:
I've been reviewing charts all this time, avoiding the noise of Twitter. The way the bullish movement happens, the way the htf resistances are testedโฆit clearly looks manipulated, with no real demand.
Once again the largest bull trap I have ever seen. But they won't catch me.
โ the Crypto Capo (@CryptoCapo_) January 21, 2023
However, not all industry experts were so pessimistic.
Cryptocurrency market analysis platform IncomeSharks looked bullish, having shared a โWall St. Cheat Sheetโ chart. with his 379,300 Twitter followers on Jan. 22, mocking bears who think the latest price moves are indicative of a "bull trap."
#Bears in the denial stage. "It's just a bull trap" "It's all manipulation." Waiting for the next part of Panic... pic.twitter.com/Lo6nWyZPD2
- IncomeSharks (@IncomeSharks) January 22, 2023
Sem Agterberg, CEO and Co-Founder of AI-based trading bot CryptoSea, also recently shared a flurry of posts expressing positive sentiment towards BTC price action to his 431,700 Twitter followers, suggesting a โBULL FLAGโ towards $25,000 could soon be in play.
Meanwhile, others have held back from making a price forecast, likely given the unpredictability of crypto markets.
Here is my technical analysis of where the Bitcoin price is going. pic.twitter.com/cOFueErgGq
โDan Held (@danheld) January 21, 2023
Related: Bitcoin price consolidation opens the door for APE, MANA, AAVE and FIL to rise
At press time, Bitcoin was priced at $22,738, while the Crypto Fear and Greed Index was in "Neutral" with a score out of 50 out of 100.
The cryptocurrency managed to break out of the โfearโ zone on January 13, which later scored 31, after the price of BTC surged for seven consecutive days.
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