State Of The Market: Winter is over for crypto

After a brutal 2022 bear market that saw crypto crash over 70%, the momentum has decisively shifted. Bitcoin blasted through resistance at $25,000, altcoins are on fire, and DeFi protocols are stirring back to life. 

We recently recorded a State of the Market podcast, discussing the current crypto market conditions and outlook. Based on the conversation, the overall sentiment seems bullish. 

Watch the full video here: 

Disclaimer: Not financial or investment advice. You are responsible for any capital-related decisions you make, and only you are accountable for the results.

Here are the key takeaways from the podcast

Bitcoin is leading the way

While altcoins have been outperforming recently, Bitcoin still dictates the overall market direction. Fundamentally, Bitcoin remains strong with upcoming catalysts like ETF approvals and the 2024 halving. Technicals also look good as Bitcoin has undone the FTX sell-off and returned to its previous range.

Ethereum is lagging but poised to catch up

Ethereum has been lagging both Bitcoin and altcoins recently. However, it appears ready for a move higher, with a bullish ascending triangle on the weekly chart. Key resistance is around $2,030, and a break above could trigger a rally to $3,000. Ethereum tends to play "catch up" after Bitcoin makes its initial move.

Altcoins are outperforming

Altcoins like Solana, Avalanche, and Chainlink have been outperforming. The key is finding fundamentally strong projects that can reclaim prior all-time highs. DeFi and layer 2s are compelling sectors. With Bitcoin rangebound, traders are switching between altcoin narratives for gains.

The macro backdrop is improving

While recession risks remain, liquidity conditions are better than expected. This reduces imminent threats and keeps risk asset valuations inflated. Crypto is well positioned with bullish catalysts, while stocks lack clear drivers.

Investor psychology is still cautious

Despite the recent uptrend, overall investor sentiment remains cautious. This is evidenced by the lack of hype or "froth" in the market. New retail interest has yet to appear, presenting room for much higher prices if participation grows.

Cryptonary’s take

The bull market has started.

Overall, our analysis indicates we have likely started a new bull market. However, we are in the early stages - it may take 12-18 months to reach full-blown euphoria. Dollar-cost averaging and staking positions make sense now before prices accelerate higher. Periodic corrections around 20-30% are expected along the way. So buckle up for what promises to be a momentous ride throughout 2023. The bulls are back in town.