As a seasoned analyst with over two decades of experience in the financial markets, I have witnessed countless economic cycles and market fluctuations. The current bullish momentum in Bitcoin (BTC) is reminiscent of the early days of the internet boom, where traditional investors were initially skeptical but eventually jumped on the bandwagon as they realized the potential of this disruptive technology.
Following Jerome Powell’s hint at potential interest rate reduction in September, the value of Bitcoin (BTC) bounced back during the weekend, surpassing significant resistance points. The leading cryptocurrency ended last week with a trade slightly above $64k, marking an approximately 10% increase compared to its close from the previous week. If Bitcoin’s price continues to show a bullish trend by the end of this current week, it may well result in a Doji dragonfly formation at the monthly close, indicating a growing optimism among investors.
As an analyst, I’ve noticed a noteworthy technical trend in Bitcoin’s price movement. In recent days, the Bitcoin price has persistently closed above both the daily 50 and 200 Moving Averages (MAs), which is remarkable given the presence of a death cross. However, this hasn’t deterred the bullish sentiment, as evidenced by the daily Relative Strength Index (RSI) bouncing back above the 50 percent mark. This rise indicates that the bulls have been gradually regaining control since the crash on August 5.
Bitcoin Price Responds to Rising Adoption by Institutional Investors
1. The persistent market recovery, fueled by Gold and standard stock indexes, points towards an unavoidable bullish trend for the entire cryptocurrency sector. Moreover, the regulatory landscape in key regions such as the U.S., Russia, Hong Kong, India, Europe, and Singapore has become clearer regarding cryptocurrencies.
Previously mentioned by Coinspeaker, the green light given for U.S. spot Bitcoin and Ethereum ETFs seems to be sparking a trend worldwide. For example, Brazil has already endorsed two Solana (SOL) ETFs that trade on the spot market, while Hong Kong, Canada, and Australia have already introduced spot-traded Bitcoin and Ether ETFs as well.
Based on recent market statistics, U.S. spot Bitcoin Exchange-Traded Funds (ETFs) recorded a net cash inflow of approximately $252 million last Friday, primarily driven by BlackRock’s IBIT and Fidelity’s FBTC. This significant influx has pushed the total net cash inflows into U.S. spot Bitcoin ETFs over the past two weeks above $550 million, indicating a strengthening bullish sentiment.
In recent times, an increase in US Bitcoin ETF holdings has occurred simultaneously with a significant decrease in the availability of Bitcoin on centralized exchanges. It’s worth noting that the quantity of stablecoins stored on these same exchanges has been rapidly growing, indicating a surge in overall purchasing potential.
Economic Shift
In simple terms, the upcoming U.S. elections and potential shifts in monetary policy could significantly impact Bitcoin’s price fluctuations. Over a span of more than 115 days since the last Bitcoin halving event, Bitcoin’s price movements are approaching a critical juncture that resembles previous bull market cycles.
#BTC Market Cycle ROI
— Benjamin Cowen (@intocryptoverse) August 25, 2024
Starting from next month, it’s anticipated that the U.S Federal Reserve will implement its first interest rate reduction since the COVID-19 pandemic. This move is seen as a clear indication of a significant change in the economy. As per Fed Chair Powell’s statement on Friday, inflation has noticeably decreased without causing a substantial increase in unemployment, which implies that the economy might require a shift over the next five years.
In my analysis, I anticipate that the increasing global liquidity, among other favorable conditions, will likely boost the value of Bitcoin.
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2024-08-26 13:26