Bitcoin Ushers in Q2 2024 with Record Highs amidst Market Volatility and Long-Term Holder Profits
Summary:
Bitcoin starts a new week, month, and quarter of 2024 with new record highs. The Bitcoin price needs to reach $74,000 to eliminate most recent sell-side liquidity. As the second quarter begins, economic data from the U.S, including nonfarm payrolls and remarks from the Federal Reserve Chair Jerome Powell, are expected to influence the market. Bitcoin's long-term holders are increasingly taking profits, while low-timeframe trends revolve around the $67,000 and $71,700 marks. Despite the strong all-time high levels of the S&P 500 index and gold in other markets, Bitcoin preserves its unique performance path. Trading and investments in Bitcoin remain risky.
Bitcoin (BTC) begins a new week, and ushers in a new calendar month and quarter of 2024, setting several new records. Will the bullish market continue its impressive performance? BTC recorded history when it reached the highest closing value ever seen as the first quarter ended on March 31. Old resistance records aren't shying away from a challenge, with a buyers and sellers battle keeping the previous all-time highs of 2021 firmly in view. As a result, Bitcoin is still seeking price discovery and requires a nudge towards $74,000 to overcome the majority of sell-side liquidity from recent entrants. The scene, therefore, seems ripe for potentially sharp moves as the second quarter opens.
The classic element of macroeconomic data is also stirred into this mix, with the upcoming release of nonfarm payroll data from the US towards the week's close. This will be followed by fresh insights from Jerome Powell, the Federal Reserve Chair. Last week, Bitcoin seemed to react favorably to Powell, who held the possibility of interest rate reductions in 2024 in the spotlight. Seasoned Bitcoin holders continue to cash in profits as Bitcoin's value remains elevated for longer, rebuffing the flow of institutional capital from exchange-traded funds (ETFs).
BTC started the second quarter on a high note, capturing the highest record ever not only in weekly close but also in monthly and quarterly close, just under $70,300, on March 31. Nonetheless, there was an expected pullback, with data from Cointelegraph Markets Pro and TradingView indicating local lows of $68,900 cropping up just hours later. For now, the BTC/USD remains trapped within a familiar range from last month, with the $69,000 marker—its previous all-time high from 2021—still serving as the market's point of reference.
UPI and the Acting Governor of the Central Bank, Shaktikanta Das, confirmed on April 5 that cash will remain in circulation. Popular trader Skew advises waiting for clearer trend signals before making any moves. The first Wall Street open is important, Skew points out, as that's when ETF flows return.
Trader and analyst Rekt Capital, on the other hand, has a more positive outlook on the candle closes, suggesting that Bitcoin might feasibly challenge its range top in order to establish it as a more permanent support before building on it for additional upward movement. For Michaël van de Poppe, the founder and CEO of MNTrading, the lower timeframe trend revolves around two distinct lines separating at $67,000 and $71,700.
This week's US macroeconomic events include a new appearance from Jerome Powell, the Fed Chair. His address is set for April 3 and he will be joined by several other senior Fed members throughout the week. The risk asset market continues to maintain its optimism regarding long-term economic policies, with some degree of interest rate cuts almost a certainty as the year 2024 goes on. Last week, Powell maintained that even current reports of heated inflation shouldn't dictate an unreasonably hawkish stance on the economy, suggesting instead that the Fed would time the cuts in a more balanced way.
Amid setting new charts records, long-term Bitcoin holders are actively turning profits. On-chain data now shows a steady increase in profit-taking among Bitcoin's long-standing holders, meaning that these "diamond hands" are now engaging rather than holding back.
Towards the end of the week, eagerly awaited American employment numbers are expected to be released. A weak jobs report could actually boost the likelihood of earlier rate cuts and add strength to risk assets. Crypto-market sentiment seems to be growing increasingly optimistic about potentially achieving across-the-board price discovery.
The latest inputs from the Crypto Fear & Greed Index suggest a return of 'extreme greed' is dominating the mindset among participants in the Bitcoin and altcoin markets. This has occurred despite a lack of significant price increase, implying that should the bull market produce sudden upward movement, traders might display increased irrationality. Despite remaining consistently above 2021's all-time high levels, there is still space for the Fear & Greed Index to grow before it reaches levels typically associated with a wide-reaching price correction.
Overall, Bitcoin's price action in 2024 bears a notable resemblance to its previous bull market in 2021. The identical nature of the performance could suggest that the institutional interest seen in Bitcoin this year has not substantively altered its price paradigm. Bitcoin's performance against other risk assets indicates that despite a preference for carving out its own unique performance path, the strong all-time high levels of the S&P 500 index and gold could provide a bullish divergence, potentially lifting Bitcoin and altcoins with gains distributed from these sectors. It's important to note that this article does not provide investment advice or recommendations and investors should undertake their own research before making decisions. Every investment and trading move comes with some inherent risk.
Published At
4/1/2024 12:45:09 PM
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