Decentral Block Post

Bitcoin (BTC) is trading at its highest levels in over two months, but the phrase on every trader’s lips is “bull trap.”

After delivering 25% returns in a single week, BTC/USD remains under suspicion among Bitcoin bear market survivors. 

Bitcoin bull trap fails to convince

It has been called the “biggest bull trap” ever seen, and despite holding above $20,000, BTC price action is fooling no one.

This week, with Wall Street closed until Jan. 17, out-of-hours trading continues to support higher levels, but faith in these staying around for long is hard to find.

For those who observed drop after drop throughout 2022, culminating in the FTX scandal, it appears simply too good to be true that Bitcoin will now flip bullish.

Bitcoin (BTC) shows the potential of stretching its ongoing price recovery to $25,000 by March, based on a mix of bullish technical and macro indicators.

Bitcoin price exits descending channel range

First, Bitcoin's potential to hit $25,000 comes from its exit from a prevailing descending channel range.

Notably, the BTC price broke out of the range late last week while accompanying a rise in its trading volumes. The cryptocurrency's move upside also pushed the price above its resistance confluence, comprising a psychological price ceiling of $20,000 and its 20-week exponential moving average (20-week EMA; the green wave) near $19,500, as shown below. 

Breaking three resistance levels with strong volumes shows traders' conviction about an extended price rally. Should it happen, Bitcoin's next upside target appears at its 200-week EMA (the yellow wave) at around $25,000 — a 20% rise from current price levels.

Dollar forms a "death cross"

Bitcoin's bullish technical outlook appears against the backdrop of a relatively weaker U.S. dollar, down due to expectations that the Federal Reserve will stop raising interest rates over lowering inflation.

The Central Bank of Iran is reportedly cooperating with the Russian government to jointly issue a new cryptocurrency backed by gold.

Iran is working with Russia to create a “token of the Persian Gulf region” that would serve as a payment method in foreign trade, Russia’s news agency Vedomosti reported on Jan. 15.

The token is projected to be issued in the form of a stablecoin backed by gold, according to Alexander Brazhnikov, executive director of the Russian Association of Crypto Industry and Blockchain (RACIB).

The stablecoin aims to enable cross-border transactions instead of fiat currencies like the United States’ dollar, the Russian ruble or the Iranian rial. The potential cryptocurrency would operate in a special economic zone in Astrakhan, where Russia started to accept Iranian cargo shipments, the report notes.

Russian lawmaker Anton Tkachev, a member of the Committee on Information Policy, Information Technology and Communications, stressed that a joint stablecoin project would only be possible once the digital asset market is fully regulated in Russia. After multiple delays, the Russian lower house of parliament once again promised to start regulating crypto transactions in 2023.

The developers of the dog-themed token Shiba Inu (SHIB) posted an update to inform its community about its upcoming beta release of Shibarium, a layer-2 network that will run on top of the Ethereum mainnet. 

In an announcement, SHIB developers shared information about layer-2 blockchains and highlighted that Shibarium is being built to provide a tool to allow the community to build and grow the project and fulfill its founder’s vision. While some believe that the creation of Shibarium is a way to increase the meme token’s price, the developers noted that this wasn’t the goal. They wrote:

“Patience is key, and some see Shibarium as a price-pumping tool, but that is not the project's focus and never has been.”

Instead, the developers mentioned that the goal of the new update in its infrastructure is to "revolutionize the Shiba ecosystem" by removing barriers to entry for small transactions, upgrading the speed, allowing the development of decentralized applications and integrating nonfungible tokens.

A key update in the new announcement is one of the most-requested features for the project, which is a burning mechanism for SHIB. According to the developers, "all transactions on the network will have an implicit burn amount for $SHIB token." This mechanism will occur whenever a transaction is made within the network. 

Bitcoin (BTC) starts a new week at new 2023 highs, but still divides opinion after a blistering price rally.

In what is shaping up to be the antidote to last year’s slow bleed to lower prices, January has delivered the volatility Bitcoin bulls were hoping for — but can they sustain it?

This is the key question for market participants going into the third week of the month.

Opinion remains divided on Bitcoin’s fundamental strength; some believe outright that the march to two-month highs is a “sucker’s rally,” while others are hoping that the good times will continue — at least for the time being.

Beyond market dynamics, there is no shortage of potential catalysts waiting to assert themselves on sentiment.