As a seasoned researcher who has witnessed the rollercoaster ride that is the cryptocurrency market, I can confidently say that this week’s Bitcoin surge has been nothing short of thrilling. The parallels drawn to the 2020 Black Thursday are both chilling and reassuring, reminding us of the resilience of Bitcoin and its ability to bounce back from adversity.
Starting off this week with a negative sentiment, Bitcoin (BTC) is poised to conclude the week on an optimistic note. The leading digital currency experienced a rise of over 6% in the last day, hitting a daily peak of approximately $62,490. In tandem, the altcoin sector mirrored this trend, propelling the collective crypto market capitalization by around 6.6% to about $2.23 trillion on Friday.
Consequently, over $221 million was withdrawn from the crypto-leveraged market, primarily affecting short sellers.
Renewed Demand for Bitcoin
Following Bitcoin’s hint of a potential return to its peak value, there’s been an increase in investor enthusiasm to jump on the bull market bandwagon. Notably, the latest Bitcoin price drop, from around $70K down to approximately $49K, bears resemblance to the 2020 Black Thursday, which was precipitated by Covid-19.
After the 2020’s Black Thursday, Bitcoin’s price began a steep increase, leading to increased speculation. On-chain analysis reveals that large Bitcoin holders, or “whales,” have been purchasing Bitcoin consistently, even during periods of high price fluctuations.
Based on a study of blockchain information from IntoTheBlock, the number of new Bitcoin wallets has hit rock bottom and started climbing again following a decline since November 2023.
The change indicates a growing curiosity among individual investors, possibly resulting in a more equitable market structure and a robust base for the upcoming expansion period, according to their observations.
It’s important to mention that at present, individuals who have held Bitcoin for a short period are experiencing the greatest unrealized losses since the FTX collapse, which triggered a swift recovery in the cryptocurrency market over the following months.
At present, Investors with short-term holdings are experiencing one of the largest potential losses yet, since the collapse of FTX, underscoring a significant level of anxiety among investors due to the challenging market circumstances.
— glassnode (@glassnode) August 8, 2024
Over the last two days, U.S.-listed Bitcoin ETFs, including BlackRock’s IBIT and Fidelity’s FBTC, have seen a total of approximately $237 million in investments pouring in.
Market Outlook
1. It’s anticipated that the Bitcoin price will experience a notable boost due to the forthcoming US elections, given the strong focus on cryptocurrency supporters displayed by both major political parties. Furthermore, there’s speculation that the U.S. Federal Reserve may lower interest rates in the near future as inflation persistently decreases.
The leading digital currency is expected to gain advantage due to regulatory transparency emerging from Russia, a significant player within the BRICS alliance.
What Next?
After reaching $62K today, Bitcoin’s price successfully filled the CME gap, signaling potential for additional upward movement. Despite concerns about a potential crypto correction in the near future, Bitcoin’s dominance has persistently grown and now exceeds 57%, marking its highest level since April 2021.
$Btc
According to the pattern, it appears that Bitcoin’s bullish trend might carry on, climbing upwards towards the upper trendline of its broadening wedge after the breakout. This could potentially take Bitcoin to the 100k mark.
— World Of Charts (@WorldOfCharts1) August 8, 2024
Looking at the technical aspect, Bitcoin’s price is nearing a significant barrier, lying between $61,000 and $63,000. If this resistance turns into a support zone in the short term, it could suggest that the current bullish trend will continue. Additionally, the Relative Strength Index (RSI) has bounced back from around 50%, suggesting potential new bullish energy on the horizon.
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2024-08-09 11:55