Chinese New Year (Lunar New Year) is around the corner. It often has a strong influence on cryptocurrency prices. Chinese New Year and Bitcoin have a “red” past together as the price of this cryptocurrency fluctuates dramatically in January.
Chinese New Year is celebrated on a different day each year as it is based on the Lunar Calendar. This year, the Chinese New Year will begin on 22 January 2023 and end on 24 January 2023.
During this time many Chinese Over-the-Counter (OTC) services will be closed – leading to high crypto volatility. According to the research, Bitcoin always experiences a dump of between 15% and 50% beginning in early to mid-January, which often sends Bitcoin down to its lowest value of the year. Will it coincide with a Bitcoin bloodbath as in previous years?
The Cryptocurrency market is surging as bitcoin surpasses the $21,000 mark. It crossed the level on Saturday, the first since November 8, 2022. The price of Bitcoin was stuck in a narrow range of around $16,000 to $17,000 for weeks before the latest breakout.
The overall market cap of the crypto universe rose above $1 trillion during the weekend for the first time since early November, according to data from CoinMarketCap. The global cryptocurrency market cap today was up over 2% in the last 24 hours to $1.04 trillion, as per the data by CoinMarketCap.
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Bitcoin is always in red during the weeks leading up to the Chinese New Year. In 2019, the Bitcoin price dropped steadily from $3,491 right before the Chinese New Year to lows of $3,397 during the holiday.
According to CoinMarketCap, during 2020, prices fell below the USD$8.3k resistance before the Chinese New Year. There was a recovery back to USD$8.5k on the first day of the holidays. However, history cannot help but repeat itself, and within the same day plummeted back below USD$8.3k.
In 2021, the tides seemed to have turned with a gradual increase from $32k to $39k in the first week of February and a huge 2-day rally up to $48k in the few days leading up to the festival. However, during Chinese New Year, prices still began retracing to $46.2k. Fortunately, this did not wipe out the pre-Chinese New Year rally.
In 2022, prices took a sharp nosedive to sub $37k levels just before the holidays. Bitcoin prices then rose sharply towards a peak of over USD$39k midway through the Chinese New Year holidays.
Looking at Bitcoin’s recent performance, experts believe that maybe this year, history won’t repeat itself. A thorough discussion on what to expect from Bitcoin in 2023 has made experts question a few things. There are not many active views on what impact the Chinese New year of 2023 will have on the price, there is a general sentiment that there are several other factors that will weigh in on the value e of the coin much more than the festival.
Also Read: Bitcoin Price Moving To $65K? Here’s What On-Chain Data And Analysts Suggest
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