During the trading on Tuesday, Bitcoin grew steadily and closed at $38,700, gaining 0.6% during the day. During the session, the digital asset reached the ten-day highs and jumped above $39,000.
Leading altcoins also followed the BTC trend. In the last 24 hours, Ethereum jumped by 3.7%, Binance Coin increased by 0.5%, and Solana gained 12.8%.
According to CoinGecko, the world's largest aggregator of data on virtual assets, the total capitalization of the crypto market rose by 1.5% to $1.86 trillion in the last 24 hours.
At the time of writing, Bitcoin's price is hovering at $38,451 and its market cap is estimated at $728 billion.
However, at the end of January, the position of VTS was not so positive: the value of the cryptocurrency fell by 18% in just one week and by 40% from the November record of $69,000. Digital asset's main competitor by market capitalization, Ethereum, lost 25% in January.
The downward movement of the cryptocurrency market in January was due to the prospects of an increase in the US Federal Reserve's interest rate and investor concerns about the rapid spread of the Omicron strain.
The growth of US stock markets and the weakening of the dollar are the main upward factors for the digital assets this week.
Bitcoin has gained nearly 20% during the last week, returning to mid-January levels. Cryptocurrency market participants are closely watching every change in the value of BTC, and buyers are in no hurry to take risks. Bitcoin has the important psychological mark of $40,000, which was its key support in early 2022.
The roller coaster trading of the flagship cryptocurrency day after day makes famous crypto-enthusiasts speculate on predictions about its future. Thus, the president of El Salvador Nayib Bukele recently declared that in the near future BTC may show spectacular growth. Even the recent IMF recommendation to the Salvadoran authorities to abandon cryptocurrency as legal tender in the country did not prevent Bukele from doubting the bright future of the asset.
Economist Benjamin Cohen, another admirer of cryptocurrencies, believes that, under favorable conditions, Bitcoin may return to a steady increase in just three weeks. The cryptoanalyst cites historical data as the main argument to defend his opinion. Traditionally, Cohen reminds us, it takes an average of 3-6 months after Bitcoin prices fall below the bull market support before it returns to growth. Currently, the bull market support is located in the $45,000-$50,000 range.
The economist also notes the high correlation of stock and cryptocurrency markets. Cohen argues that if the leading US stock indexes continue to decline, BTC is likely to follow suit.
IoTeX co-founder Raullen Chai also has an optimistic outlook on the future of Bitcoin.
The expert is confident that the BTC market has strong bullish sentiment ahead.
Chai believes that the key principles of BTC and leading altcoins are aimed at solving the current problems of society. Therefore, a temporary market decline is unlikely to have serious consequences for them. According to the expert, it is important to invest in cryptocurrency with broad usage opportunities, which will withstand a temporary bearish trend and instantly recover on the background of favorable signals.