• Bitcoin (BTC) has found stability above $42,000 after an unstable couple of weeks that saw the crypto king plunge below the $40,000 psychological support.
• Key economic data scheduled for release by the U.S. government could influence the direction BTC takes in February.

After a volatile couple of weeks, Bitcoin (BTC) has seemingly found stability at the $42,200 level. In the past month, BTC has rallied to a high of $49,000 but subsequently plunged to a low of $38,000. This price movement has been influenced by the historic approval of a Bitcoin spot ETF, with 11 filings receiving the green light on January 11th.

But though the approval led to a short-term rally, influenced by the largest Bitcoin ETF witnessing record outflows, it has led to immense Bitcoin selling pressure that has seen it bottom at $38,000. The outflows, which exceeded $4.6 billion, have slowed, leading to a Bitcoin price recovery.

At the time of writing, BTC is trading at $42,177 after a less than 1% drop in the last 24 hours. On the weekly chart, the crypto king has added around 3% to see its market cap reach a little over $827 billion.

With Bitcoin now enjoying price stability, investors can begin to forge a bullish path. February could be a significant month for the crypto market. Key data will be revealed by the U.S. government over the coming days and weeks, which could lay out a clear path for BTC.

Later this week, the Federal Reserve is preparing to disclose its initial interest rate decision for the year 2024. The Chicago Mercantile Exchange (CME) indicates a strong consensus, with 96.9% of indicators showing the rate will remain unchanged. However, in March, the consensus shifts to a 47% possibility of the interest rate being cut by 25 basis points. This could be a major development because it will be a month before the April halving. It offers a major boost to the digital asset that has historically rallied pre-halving.

Another key metric set to be announced is the January unemployment rate. This could play a part in the trajectory of monetary policy and economic conditions in the United States. Legendary Bitcoin advocate Samson Mow has highlighted some developments that could affect prices soon.

Sentiments are currently bullish, with the Fear and Greed index showing a neutrality index. This is to say that investors are cautiously optimistic going into the new month. Interestingly, historical data shows the month of February to be a bullish one. Since 2020, the month has witnessed returns of an average of 14.5%.

All this not forgetting the U.S. 2024 elections which could affect regulations and policies. Some have even argued that this played a part in the SEC approving ETFs.

However, as CNF recently reported, concerns about a heavy supply of Bitcoin could negatively affect prices. Major selling pressures from Grayscale, MtGox, Celsius, Bitcoin Miners, and the US Government threaten BTC’s value. In total, these institutions hold BTC worth more than $20 billion.

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