Both technical and fundamental issues brought Bitcoin lower today, but the fundamentals really caused damage to pricing.

Bitcoin had some solid gains starting overnight or in the overseas markets and lasted up until the open in New York before hitting resistance and giving back only a small fraction of its gains. Currently as of 2 PM EST, Bitcoin is trading at around $44,150 on the spot market and $44,215 in CME futures.

Over the weekend Bitcoin traded to a low of roughly $41,600 on an intra-day basis. However, on a closing basis Bitcoin managed to effectively hold above the 50-day moving average, which is now sitting just below $42,000 at $41,900.

The CPI (consumer price index) numbers came in for January, showing a sizeable increase year over year compared to last month. It came in over analysts’ expectations, predicting a 0.2% – 0.3% increase coming in at a staggering 7.5%—this a half of a percent increase over December’s numbers. So not only are we looking at a 40-year high, but it continues to rise even still.

Although BTC has gained $8,000 over the past three weeks, and yesterday broke and closed above its 50-day moving average for the first time in three months, it is too early to presume that it is experiencing a Bull Run. Many of the technical indicators that traders use to decipher if a market is bullish or bearish point to different conclusions.

As of 5:30 PM Eastern Standard Time, yesterday Bitcoin was trading at approximately $38,775, gaining almost 1% on the day and 5.7% higher on the week. Although this week’s relief rally appears to be a turning point in the markets, when looking at the bigger picture, the gains this week across-the-board in most crypto’s is nothing more than bargain-hunting.

One of the most reliable patterns in determining a reversal from bullish to bearish is known as a “head and shoulders.” One has clearly formed in Bitcoin and could signal a revisit to the $30,000 level.

Following last week’s dramatic decline in Bitcoin and across cryptocurrencies as a whole, BTC has gained over $4,000 off of the lows from today at $33,000 and at 5 PM, EST is trading at roughly $37,000. It is fast approaching a key level that if taken out could erase the bad memories from this weekend and signal a recovery rally is in full effect. So, did we just witness a bottom?

The path that BTC has taken over the past 2 ½ months should really be no surprise to us at all, for it has followed the exact same trajectory in the three months following its first ATH ($65k) in 2021. Not only have the corrections following both all-time highs matched in both intensity and duration, but the rallies proceeding the apex in both instances also share very similar characteristics.

The bullish reversal we were looking for has occurred in Bitcoin, and that has brought back strong upsides in the rest of the cryptocurrencies, as it tends to do. On Monday, we sighted the low of the day which matched the lowest trading point Bitcoin has seen in the past four months.