Bitcoin Surges Past $70,000: Signs of Bullish Trend and Increased Institutional Support
Summary:
Bitcoin (BTC) has crossed the $70,000 mark for the first time in six weeks, reinforcing confidence among buyers and suggesting a potentially bullish trend. This ascent has lead to an increase in the funding rate, suggesting a strong preference for longer-term Bitcoin positions among traders. Technical patterns and trends such as the inverse head and shoulder pattern and fractals also suggest more upside momentum for Bitcoin. Additionally, positive inflows were seen in Bitcoin exchange-traded funds (ETFs), indicating strong institutional support for the cryptocurrency.
For the first time in six weeks, Bitcoin (BTC) has soared past the significant $70,000 barrier. This highlight is why purchasing the Bitcoin plunge below $70,000 might have been a wise decision. On May 20, Bitcoin achieved a six-week peak at $71,401, a level that hasn't been reached since April 9, based on TradingView data.
As Bitcoin surges past the psychological threshold of $70,000, there has been a corresponding increase in the funding rate. According to data from Coinglass, Bitcoin's funding rate ascended to 0.0187%, marking the apex since April 9, indicating an increasing trend among traders to have long BTC positions.
The positive funding rates show traders' inclination towards utilizing leverage for extended Bitcoin holdings. Before its $70,000 surge, Bitcoin's funding rates were languishing below the 0.01% rank for the preceding month, which suggests a growing confidence among Bitcoin purchasers.
Adding to this optimism is the recent demonstration in the 4-hour Bitcoin chart of an inverse head and shoulder pattern, a classic bullish signal for trend reversals. Analysts suggest that the pattern predicts Bitcoin's upward trajectory.
From a technical perspective, fractals underpin the current upward trend. These patterns, which recur across different timeframes, suggest Bitcoin's current ascend, as illustrated in the weekly chart, are similar to its November 2021 rally from $31,000 to $69,000. If the present chart patterns continue, Bitcoin could experience further upward movement in the subsequent weeks.
Notably, the current Bitcoin price trend also appears to echo the 2017 bull run, causing anticipation of smooth sailing once previous cycle highs are cleared.
Moreover, Institutional inflows into United States' Bitcoin exchange-traded funds (ETFs) have reported positive inflows for 2 successive weeks, breaking the preceding 3 weeks of net negative outflows. The ETFs collected over $200 million worth of Bitcoin during the past week, and over $413 million in the week of May 6, as per Dune data. On May 20, Bitcoin ETFs experienced positive inflows exceeding $235 million, outdoing the net inflows for the prior week according to Farside Investors data.
Investments from these ETFs played a considerable role in Bitcoin's rally to new record-breaking levels, particularly around February 15 when Bitcoin ETFs comprised nearly 75% of the fresh investment in the largest cryptocurrency as its worth overrode the $50,000 mark.
Published At
5/21/2024 6:21:21 PM
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