Key Points
- Bitcoin (BTC) price surpasses $70K, fuelled by Spot ETF demand and upcoming US elections.
- Bitcoin’s bullish sentiment is back after being in a falling trend for the past seven months.
Bitcoin’s (BTC) price has surged over 4 percent in the past 24 hours, reaching a daily high of around $71,540 before settling at about $70,825 on Tuesday during the mid-London session.
This surge marks the return of bullish sentiment for the leading cryptocurrency, which had been caught in a declining trend for the past seven months.
Technical Analysis and Market Response
From a technical perspective, the only barrier to a parabolic Bitcoin rally is the resistance range between $71K and $73K. According to experienced trader Peter Brandt, Bitcoin is well-positioned for a rally towards the next midterm target of around $94k.
Furthermore, Bitcoin has successfully retested the bullish breakout from a falling logarithmic trend that started in March this year. The altcoin market, including Ethereum (ETH), Solana (SOL), and Dogecoin (DOGE), closely followed the significant Bitcoin price spike.
This sudden crypto pump led to more than $228 million being liquidated in the past 24 hours, with over 81 percent involving short traders. As a result, the possibility of a short squeeze in the Bitcoin market has significantly increased, which could trigger a rally beyond $100K in the coming months.
What’s Driving Bitcoin’s Price Rally?
Bitcoin’s price has been gaining bullish momentum on a weekly basis, after establishing a strong support level following the market crash on August 5. The leading cryptocurrency has been trying to replicate the bullish breakout similar to Gold, which is currently in price discovery.
The notable spike in the past 24 hours was largely driven by the increasing demand from institutional investors and several nation-states, led by El Salvador. According to the latest market data, the overall supply of Bitcoin on centralized exchanges has decreased by over 40K in the past four weeks.
US spot Bitcoin ETFs significantly accelerated their overall Bitcoin purchases recently, accounting for over $3.5 billion in the last four weeks. On Monday, the US spot Bitcoin ETFs recorded a net cash inflow of more than $479 million, thus currently holding nearly $69 billion in assets under management.
Bitcoin’s price has also been reacting to the potential win for the Republican presidential candidate Donald Trump, who has largely identified with the crypto world. According to market data from Polymatlet, a top-tier decentralized betting platform, Trump has a 66 percent chance of winning next week’s elections.
Meanwhile, the US Fed is expected to initiate another rate cut next week in a bid to strengthen the economy, which has a long-term bullish impact on Bitcoin.
