Why Is Bitcoin Up Today?
The Bitcoin price has risen 3.2% since yesterday’s low of $24,827. At press time, BTC was trading at $25,590 and has thus reclaimed two extremely important price levels for the moment: first, the Bitcoin price has once again risen above the 200-day Exponential Moving Average (EMA) currently at $25,299, and second, the price is now also back above the 200-week EMA at $25,304 (with the weekly close becoming of crucial importance).
As always, there are several narratives for yesterday’s rise in price. The most obvious narrative and currently the biggest topic in the market is the Bitcoin spot ETF filing by BlackRock, the world’s largest asset manager, with the US Securities and Exchange Commission (SEC). A spot ETF is seen as the holy grail that could finally open the floodgates for institutional liquidity, as Bitcoinist reported today.
Reasons For The Bitcoin Rally
BlackRock is believed to have a strong chance of getting the first spot-based Bitcoin ETF approved by the SEC due to its political influence and network. The new capital inflows made possible may have the potential to be the next bull run catalyst, according to many experts.
“BlackRock getting a BTC ETF through would be the best thing that could happen to BTC,” Galaxy Digital CEO Mike Novogratz said yesterday. Accordingly, the news is likely to have created a bullish sentiment in the market.
However, as always, several reasons play a role in the price movement on the Bitcoin market. One issue that should not be neglected is always the macro situation and the US dollar index (DXY). The latter has seen a setback in the last three days, falling from 104.70 to currently 102.21. This is likely to have favored BTC for now.
As for the macro situation, Wednesday’s interest rate decision by the US Federal Reserve (Fed) certainly still plays a role. The main story is that the market is not buying Fed Chair Jerome Powell’s hawkish stance. Analysts believe that the two more rate hikes announced in the dot plot are a feint to prevent a bullish breakout in the financial markets.
Finally, BTC’s decoupling from the S&P 500 has also been seen in recent days. Yesterday’s move could have been the start of a catch-up rally in which BTC shakes off the unnecessary losses caused by the Tether FUD and the SEC lawsuits against Coinbase and Binance US.
In addition, Bitcoin hodlers continue to show historically high conviction. As on-chain analyst Axel Adler Jr explained via Twitter, the total BTC inflow across all exchanges is currently at a low, suggesting that Bitcoin holders are in no hurry to sell their coins.
The total BTC inflow across all exchanges is currently at a low, indicating that Bitcoin owners are not in a rush to sell their coins. #Bitcoin #HODL pic.twitter.com/JTscheVcgO
— Axel 💎🙌 Adler Jr (@AxelAdlerJr) June 16, 2023
As NewsBTC reported, yesterday’s Tether FUD may also have once again marked the bottom for Bitcoin. Within the last bear market, there have already been three de-pegging events of stablecoins, all of them were marking the local bottom.
At press time, BTC changed hands for $25,590.
Featured image from iStock, chart from TradingView.com
