Bitcoin Bulls Remain in Control as Market Consolidates
Positive Factors Driving Bitcoin Price
The Bitcoin (BTC) bulls are maintaining control as the world’s largest cryptocurrency continues to consolidate above the $34,500 level. This follows a significant 15% surge last week. Several positive factors are contributing to the optimism surrounding Bitcoin’s price:
- Expected upcoming spot Bitcoin exchange-traded fund (ETF) approvals in the US
- A growing safe haven narrative as Bitcoin outperforms the falling stock and bond market
- Crucial US economic events, including the Federal Reserve’s announcement on monetary policy, the monthly US jobs report, and ISM PMI survey data
The recent strong US economic data and hawkish communications from the US Federal Reserve have affected stocks negatively in October. However, Bitcoin’s performance is particularly striking as it has been less correlated with stocks in 2022. Despite this correlation, the bulls predict a near-term move above $40,000 for BTC, with Matrixport even forecasting a potential rise to $42,000 following the official news of spot Bitcoin ETFs securing approval in the US.
Building Excitement in the Bitcoin Market
On-chain data supports the increasing excitement in the Bitcoin market. Large transactions of over $100,000 in value on the Bitcoin blockchain reached their highest level in 2023 last week, according to crypto analytics firm IntoTheBlock. IntoTheBlock suggests that the surge in institutional activity is potentially a sign of what is to come in 2024. At the same time, the dollar value of total transfer volumes on the Bitcoin blockchain has also been rising, with the seven-day exponential moving average hitting a near-one-year high above $32.5 billion. The number of Bitcoin transactions has seen significant fluctuations recently, reaching a new all-time high near 600,000 per day before experiencing a sharp pullback and subsequent rebound.
“The Bitcoin spot ETF applications appear to have increased whales’ and institutions appetite for Bitcoin.” – IntoTheBlock
The approval of spot Bitcoin ETF applications is not the only bullish narrative anticipated to boost the BTC price in 2024. Analysts also point to the halving of the Bitcoin issuance rate, the start of a new Fed interest rate cutting cycle, and the possibility of greater clarity from regulators and Congress in the US as potential factors influencing the price of Bitcoin.
