Bitcoin Gains New Technical Stability, Implying More Gains Are Coming
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Positive signs are emerging for bitcoin on technical charts. The world’s number one digital currency by market cap is holding a key support level that could insinuate bullish trends will again emerge for the asset in the coming weeks and months.
Bitcoin Gains Traction
Bitcoin fell by nearly six percent in mid-May. However, the asset – at the time of writing – has since risen by more than one percent and is trading in the low $27K range. Some believe this is because bitcoin has been largely tied to USD as of late, a sudden and interesting change for the world’s top digital currency. With the dip the dollar has taken in value, this could be why BTC has endured a small slip.
Alex Kuptsikevich – senior market analyst at FX Pro – said in an interview:
By defending this key average, the bulls have convinced the market of the sustainability of the long-term bullish trend.
He further stated that there are many cautious buyers in the mix as of late, and if they’re going to come back to the trading scene, bitcoin will need to reach a price of at least $28,500.
Others, by contrast, are a little more positive in their sentiment towards BTC and say that as the dollar continues to heal itself and rise through the price ranks, bitcoin will as well. Ilan Solot – co-head of digital assets at Marex – explained:
I think the dollar is due for a bounce as markets take back some Fed easing implied in the futures curve. My fundamental FX framework: currencies are driven by real growth differentials and political considerations over longer cycles, but in the short term, it’s all about playing relative central bank policy (changes in nominal rates). Depending on how violent the dollar upswing gets, it could cause some short-term damage to assets like commodities and crypto.
His words were seconded by analysts at Swiss Block Insights, who mentioned in a statement:
The DXY could hit anywhere from 104 to 107 considering it crossed over the 102 level since mid-March… This month-long structure will eventually break, and both assets will experience price discovery. Bitcoin to the upside, and DXY to the downside.
More Wallets Holding onto Coins
Solot further pointed out that there are many long-term wallets that have held coins for at least a six-month period prior to press time. Many of these wallets have accumulated new assets, suggesting they feel the digital currency space is going to endure more bullish trends in the coming future and likely experience greater price explosions.
2023, for the most part, has been quite different from 2022, which is arguably the worst year on record for BTC and crypto. The previous 12 months saw the world’s main crypto asset lose more than 70 percent of its value.
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