Bitcoin Advances towards Previous Highs Amid Optimistic Market Indicators
Summary:
As March concludes, Bitcoin (BTC) is nearing its previous all-time highs, showing renewed energy in the market, raising hopes among investors. The upcoming rise in mining difficulty and other bullish factors also strengthen this sentiment. Meanwhile, developments such as the evolution of the US spot Bitcoin exchange-traded funds (ETFs) and several indicators hint at a possible trend reversal. However, mainstream interest, as revealed by Google search data for "Bitcoin," is on a declining trend, despite the cryptocurrency's recovery.
As we approach the last week of March, Bitcoin (BTC) is on the cusp of nearing its previous all-time highs. The cryptocurrency market is showing signs of revival, sparking hopes of a return to form among investors. In stark contrast with last week's bearish performance, the tables might be turning for Bitcoin. Despite a plunge of 17% from its high of nearly $74,000, the landscape seems more optimistic now with investors looking forward to a renewed attempt to reach the record highs.
The incoming rise in mining difficulty alongside other bullish indicators has further boosted confidence. Meanwhile, macroeconomic factors could potentially infuse more volatility into market assets, including Bitcoin. A deeper examination of these catalysts lays ahead.
This past weekend, Bitcoin had a promising run, as its slow yet consistent rise culminated in a weekly close of almost $67,200 on Bitstamp. This figure, though $1,200 less than the previous one, tempered most of the recent loss, bringing BTC/USD up from sub-$61,000 lows on March 20. Now, an existing gap in the CME futures market is drawing the attention of several analysts including Mark Cullen, who notes that these gaps often act as a gravitational force for BTC/USD when a new trading week starts.
However, some market participants express cautious optimism about the vitality of the ongoing Bitcoin bull market. JT, a fellow trader, highlights a series of oscillators, such as the Relative Strength Index (RSI), which suggest a possible trend reversal.
Analyst Alan Tardigrade, on the other hand, observes a potential uptrend on daily RSI data, forecasting a possible surge in BTC value in the coming week. Similarly, based on the daily Moving Average Convergence/Divergence (MACD) indicator, analyst Kevin Svenson also cautiously echoes a bullish sentiment.
The narrative of the US spot Bitcoin exchange-traded funds (ETFs) aligns with these hope-filled predictions. To date, they have marked five straight days of net negative flows for the first time. The drain is largely credited to record outflows from the Grayscale Bitcoin Trust (GBTC), which were purportedly impacted by maneuvers from the bankrupt crypto lender Genesis. Despite GBTC's significant outflows, the primary ETF providers continue to maintain their inflows, indicating resilience among new buyers.
This coming week will also witness the Personal Consumption Expenditures (PCE) Index, the Federal Reserve's favored inflation measure, take center stage in the US macro data prints. Fed Chair Jerome Powell's speech may bolster the conviction of successive rate cuts by the year's end.
Bitcoin network fundamentals like mining difficulty are holding steady despite recent price volatility, preparing for an upward continuation. As miners get ready for the April 20 block subsidy halving, which will reduce Bitcoin's emission per newly mined block by 50% to 3.125 BTC, analysts predict a global restructuring.
While the Crypto Fear & Greed Index remains close to the "extreme greed" territory at 75/100, Google search data for "Bitcoin" shows a decline, indicating less mainstream interest despite Bitcoin's recent resurgence.
Finally, Willy Woo, creator of data resource Woobull suggests that the intensity of the Bitcoin bull market should not be underestimated as he sees a distinct difference between traditional finance and Bitcoin market behavior.
Published At
3/25/2024 11:33:44 AM
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