- BTC rises above the 200 SMA and holds above 87k.
- Bitcoin spot ETFs book seven consecutive days of inflows.
- Optimism surrounding Trump’s trade tariffs supports risk assets.
- But – BTC funding rate turned negative.
- April 2, “Liberation Day,” will provide more clarity on direction.
Bitcoin has staged a stunning comeback, surging past the critical 87,000 mark and leaving bears in the dust! After flirting with lows of 77k, the king of crypto has roared back, smashing through the key 200-day Simple Moving Average (SMA) and hitting a glorious 3-week high of 88.7k yesterday. Today, the bulls are holding strong above 87k, signaling a potential resurgence in the market.
This electrifying recovery isn’t just a Bitcoin phenomenon. The entire crypto sphere is buzzing with renewed energy, with the total market capitalization ballooning by a massive $400 billion since March 10th!
What’s Fueling This Fiery Rebound?
The resurgence in Bitcoin’s price is being fueled by a potent cocktail of positive catalysts:
- ETF Inflows are Back in Town! After weeks of outflows, Bitcoin spot ETFs are experiencing a resurgence in demand, marking seven consecutive days of inflows. This signals renewed institutional interest and a bullish sentiment returning to the market.
- Whales are Loading Up! Bitcoin futures open interest has seen a significant jump this week, confirming the bullish mood. Meanwhile, crypto titans like MicroStrategy have crossed the monumental 500,000 BTC holding mark, and even GameStop is jumping on the Bitcoin bandwagon!
- Tech Stocks on the Rise: Bitcoin continues to dance in lockstep with the Nasdaq 100, which has seen a healthy 2.75% gain this week, recovering from a recent low. This strong correlation suggests that positive sentiment in the tech sector is spilling over into the crypto market.
- Trump’s Trade Truce? Whispers of optimism surrounding President Trump’s upcoming trade tariff announcements are adding to the positive vibes. The market is hoping for a less severe stance than initially feared, which is boosting risk assets across the board.
- Fed Keeps Calm: The Federal Reserve’s decision to maintain its outlook for two rate cuts this year in the March FOMC meeting has also injected confidence into the market.
But Hold Your Horses! Clouds on the Horizon?
While the current rally is exhilarating, caution flags are waving. Macroeconomic uncertainties persist, and thin trading volumes suggest this recovery might be fragile. The threat of escalating trade wars remains a real possibility, even if Trump’s initial tariffs are milder than expected. Inflation concerns also linger, especially after the Fed’s upward revision of its inflation forecast. Keep an eye out for Friday’s Core PCE data for further clues!
A Bearish Whisper in the Bullish Wind?
Adding to the cautious sentiment, the Bitcoin funding rate shockingly turned negative at the start of the week, even as BTC’s price climbed. This indicates that traders are willing to pay to hold short positions, suggesting that bearish sentiment might still be lurking beneath the surface.
All Eyes on April 2nd: “Liberation Day” Looms!
The crypto world is holding its breath for April 2nd, dubbed “Liberation Day,” when President Trump is expected to unveil his tariff plans. This pivotal moment could either ignite a further rally in Bitcoin and other risk assets if Trump adopts a softer stance, or trigger a sharp decline if he takes a more aggressive approach. Even vagueness could spook the market, given its aversion to uncertainty.
Bitcoin Bulls vs. Bears: The Technical Showdown!
From a technical perspective, Bitcoin has successfully broken above the crucial 200 SMA, reaching a high of 88.8k. However, the price is still battling against a multi-month falling trendline. Bulls need to conquer this resistance to fuel a further rally towards the psychological barrier of 90k, and potentially even 95k!
On the flip side, if Bitcoin fails to break through the falling trendline, we could see a retest of the 200 SMA. A break below this level could open the floodgates to 80k, and potentially even a revisit of the 77k low.
The Bottom Line: Buckle Up for Volatility!
Bitcoin’s recent recovery is undoubtedly exciting, fueled by a confluence of positive factors. However, with “Liberation Day” just around the corner and underlying bearish sentiment still present, volatility is likely to return. Whether Bitcoin will continue its upward trajectory or face a sharp correction hinges on Trump’s tariff announcement. Stay tuned, crypto enthusiasts, because the next few days are shaping up to be a wild ride
