Bitcoin is on track to post the largest quarterly increase since the beginning of 2021, when it set a new high.
According to some experts, the token is being considered as a hedge against the issues in the banking sectors of the United States and Europe, and it is profiting from hopes of looser monetary policy to cushion countries from the consequences of those woes.
“The behavior of the price through this crisis is going to attract more institutions,” Ark Investment Management’s Cathie Wood said on Bloomberg Television, alluding to the collapse of three US bankers and competitor UBS Group AG’s emergency purchase of Credit Suisse Group AG.
After a $1.5 trillion fall last year, Bitcoin’s comeback has helped the digital-asset market add nearly $390 billion in value by 2023.
The recovery has been fueled by crypto bankruptcies, a US regulatory crackdown, and the temporary de-peg of a crucial stablecoin designed to maintain a steady $1 value.
This week’s rise has stalled, with the token trading at $28,000 as traders await the latest Federal Reserve policy announcement. Crucial indications indicate that any pause or retreat is most likely just a speed bump on the route to further gains.
Quarter to Remember
Bitcoin has increased by 70% since the beginning of 2023.
The Federal Reserve’s balance sheet was increased by $300 billion last week as part of attempts to bolster liquidity in the US banking industry, which is favourable for risk assets and has supported crypto and gold. Pepperstone Group Ltd.’s head of research, Chris Weston, said in a note.
Toward $35,000?
Bitcoin has formed a reverse head-and-shoulders pattern, which is commonly regarded as bullish. According to the technical analysis, the price target is around $35,000.
“With interest-rate markets gone from pricing in rate hikes to pricing in rate cuts, there is now a gentle tailwind supporting Bitcoin,” Tony Sycamore, market analyst at IG Australia Pty, wrote in a note.
In the Clouds
Bitcoin has entered a zone denoted by a weekly Ichimoku cloud, a technical indicator that employs mathematical principles to help determine levels of resistance and support.
The breach in the cloud indicates the possibility of more growth.
According to Bendik Schei, head of research at K33, the token may “ride the narrative as a system hedge” and benefit from central banks being pushed to inject liquidity to address bank-sector wobbles.
Temporary Pullback
The DeMARK Sequential indicator is flashing red, which is a way of measuring price momentum that attempts to predict when a market trend has run its course.
According to the analysis, the study employs a counting technique applied to chart patterns and has printed a 9 count, which likely foreshadows a downturn.
DeMARK indications indicate to a neutral short-term bias, but other chart patterns might soon signal to a “long-term breakout,” according to Katie Stockton, creator of Fairlead Strategies LLC.
