Bitcoin Easily Breaks Above $26,500 – Bullish Weekend Ahead?
Bitcoin, the world's largest cryptocurrency, surpassed the $26,000 mark again amid an extremely bullish macro environment.
The digital asset’s recent rally has been spurred by a confluence of factors, including a recent decision by the US Federal Reserve to turn on the money printer again to bail out US banks. The Fed has added a record-breaking $300 billion in assets to its portfolio within the last week, offsetting quantitative tightening (QT).
This sudden increase in the Fed’s balance sheet is particularly noteworthy. It is the largest amount added since the central bank pumped $500 billion into the market after the COVID-19 crash in March 2020. Furthermore, bond yields have plummeted by over 25%, and the Consumer Price Index (CPI) has fallen to 6.0% on an annual basis, in line with expectations. These events have drastically altered the expected interest rate and pace of hikes from further tightening to imminent easing.
According to German journalist and author Holger Zschaepitz, this round of quantitative easing (QE) is taking place worldwide and driving stock markets up. In a recent tweet, Zschaepitz noted that central banks are again pumping billions in liquidity into the market, causing the combined balance sheet of the three leading central banks to rise.
It's the liquidity, stupid! This chart shows why stocks are rising in the midst of the banking crisis. Central banks are again pumping billions in liquidity into the market. The combined balance sheet of the 3 leading CenBanks rising again. pic.twitter.com/DX8MzlbRix
— Holger Zschaepitz (@Schuldensuehner) March 17, 2023
The bullish macro environment has led to a surge in the price of Bitcoin, with the digital currency breaking through the key resistance area at $25,000 and attacking yearly highs.
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Founder of Eight Global and analyst Michaël van de Poppe called the move “great” and expects the price to hit $28,000-$30,000 if it can sustain above $25.9K for support.
Great move on #Bitcoin, broke through crucial $25K and attacking the yearly highs.
On lower timeframes, I'm watching whether $25.9K can sustain today for support.
If it can't, harsh correction might be it.
If we can, $28K-30K is next -> potential shorts. pic.twitter.com/iRGB6U61fe— Michaël van de Poppe (@CryptoMichNL) March 17, 2023
Renowned analyst Bob Loukas also expects the digital currency to move towards $28,000 and even possibly $32,000 once it clears the $25k range.
$BTC seems to be chipping away at overhead resistance at the $25k range in an early cycle move.
Feels like a move to $28k-$32k will be next, once cleared. pic.twitter.com/dVK314fEwD
— Bob Loukas 🗽 (@BobLoukas) March 16, 2023
Despite these optimistic predictions, some cautionary voices warn of another setback. Greeks.Live, for instance, has stated that 46,000 BTC options with a put-call ratio of 1.11, a maximum pain point of $23,000, and a face value of $1.18 billion are about to expire, which could lead to increased volatility in the market.
46,000 BTC options are about to expire with a Put Call Ratio of 1.11, a max pain point of $23,000 and a notional value of $1.18 billion.
288,000 ETH options are about to expire, with a Put Call Ratio of 1.12, a max pain point of $1,550 and a notional value of $490 million. pic.twitter.com/35dp0EqlsL— Greeks.live (@GreeksLive) March 17, 2023
Meanwhile, analysts from The Kobeissi Letter are skeptical of the current market conditions and state that “nothing adds up.” They argue that tech stocks are rising as if a recession has been avoided, oil prices are falling as if the world is in a recession, regional banks are down as if the banking system has collapsed, and big banks are rising as if everything is fine. “We are at a major pivot point all around the board, especially with Fed policy in question. Next few weeks are big,” the analysts concluded.
As with any financial market, the price of Bitcoin is subject to various positive and negative factors. While the recent surge in price has been fueled by a bullish macro environment, it remains to be seen how sustainable this rally is and whether it will continue in the long run.
Andrey Kunev
Reporter at CoinsPress
Andrey Kunev is a knowledgeable cryptocurrency content creator passionate about the crypto market. With extensive experience in market analysis and investment reporting, Andrey is a valuable asset to the CoinsPress team. As a frequent contributor, he offers insightful and comprehensive coverage of market trends, price fluctuations, and new advancements in cryptocurrency. Whether you're a seasoned investor or just getting started, Andrey's clear and concise writing offers a comprehensive look at the current state of the crypto market and its prospects. Stay up-to-date with CoinsPress's expert analysis and commentary on all things cryptocurrency.
