In a dramatic bullish move, Bitcoin (BTC) broke the $60,000 barrier and hit a daily high of $60,700.
Over the past 24 hours, Bitcoin has risen by an impressive 6.2 percent, a weekly gain of 18.3 percent, and an impressive 158 percent gain over the past 12 months. But what is driving this dramatic rally and how will market sentiment react to the news? Let's dive in.
The recent spike in Bitcoin prices following the approval of 11 Bitcoin exchange-traded funds (ETFs) in the United States earlier this year may be due to a sharp increase in institutional interest. This development has opened the floodgates for institutional investors who are now flocking to the crypto market in search of profitable opportunities.
Adding fuel to the fire is the highly anticipated Bitcoin halving event, scheduled for April this year. Historically, halvings have sparked bull runs, as mining rewards have halved, causing inflation of new Bitcoin supply to drop by 50%.
A confluence of technical indicators suggests an extremely bullish outlook for Bitcoin. The Relative Strength Index (RSI) currently stands at 86/100, indicating that BTC is very overbought. This means that buyers account for nearly 86% of the market share and far outnumber sellers.
Bitcoin's Average Directional Index (ADX), which measures the strength of a particular price movement, is currently at 39, indicating a strong uptrend. Typically, ADX is considered balanced when it hovers around 20.
Furthermore, the separation between Bitcoin's 10- and 55-day exponential moving averages (EMA10 and EMA55) is widening every day, indicating that the price is moving higher as time goes on.
Greedy, greedy bitcoin traders
The Crypto Fear and Greed Index, which measures the overall sentiment of the crypto market from 1 to 100, currently sits at 82. Markets are “very greedy” for the first time since 2021. The charts already show: a high sense of brutality among traders.
Interestingly, this is the first time since the inception of the Crypto Fear and Greed index that market sentiment is showing a consistent upward pattern. Instead of reacting dynamically to news and events, traders have gradually gained confidence in higher rates since June 2022.
In contrast, the S&P 500 Fear and Greed Index has remained in “extremely greedy” territory since December 2023. This was mainly driven by the buzz around AI stocks, which fueled the index's recovery last year.
The overall crypto market is mirroring Bitcoin's bullishness, with total market capitalization at $1 billion in the last 24 hours, rising from $2.2 trillion to $2.3 trillion, with PEPE leading the round +41% in 24 hours and BitTensor (TAO) registering. The worst performance is only -3%.
Edited by Stacy Elliott.
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