Bitcoin may close February in the black and resume falling in March

At the moment, we are seeing a correction to the general downward trend in the cryptocurrency market. Technology stocks and cryptocurrencies correlate, but the current growth of BTC occurs in the absence of a significant positive for stock securities. Something similar was observed in the fall, when digital assets were noticeably ahead of “growth stocks” in terms of positive dynamics. It ended with the beginning of a deep correction in both technology stocks and cryptocurrency.

Of course, when making forecasts, you should not rely entirely on history, but it is still worth taking into account the events of the recent past. Especially if we postulate the relationship between the Fed’s policy and the dynamics of the cryptocurrency market. If we believe that the large-scale incentives of the American regulator have led to an increase in the value of digital assets, then we should expect a drop in prices in the event of a curtailment of support. Now both forecasts for inflation, which may reach a 40-year high in January, and strong data on the US labor market speak in favor of raising the Fed’s rate.

If we focus only on the dynamics of supply and demand.

Then a weak basis for the current take-off of BTC quotes catches the eye. In the short term, we should expect a return of quotations to $ 40-41 thousand per coin. As for the long-term perspective, the probability of moving to $29 thousand is still preserved. It is important to keep in mind that from November to January, the main cryptocurrency managed to fall in price by 50% – this is quite a large figure for such a short period of time. Thus, the asset may even close February in a small plus and resume falling only in March. It is worth remembering that even in the bear market of 2018, there were “green” months, but the global trend was still downward.