Key Points
- Bitcoin (BTC) has surged over 7 percent, reclaiming the $66K mark, driven by US inflation data.
- The S&P 500 and Nasdaq Composite Index also experienced growth, hitting new all-time highs.
The price of Bitcoin (BTC) has seen an impressive increase of over 7 percent in the last day, pushing it back over the $66K threshold. The significant boost in trading volume, which nearly doubled its daily average to around $42 billion, was observed during the early London session on Thursday.
The catalyst for this sudden surge in Bitcoin’s price is attributed to the inflation data from the United States’ Bureau of Labor Statistics, specifically the Consumer Price Index (CPI). Interestingly, the US CPI monthly inflation data was lower than anticipated at 0.3 percent, leading to a weakening of the US dollar against global currencies.
Stock Indexes and Bitcoin
The recent inflation data has had a ripple effect, causing major stock indexes, spearheaded by the S&P 500 Index (SPX), to rise against the US dollar. The S&P 500 experienced a 1.17 percent increase, reaching a new all-time high of approximately 5,308.15 in the extended session. The Nasdaq Composite Index also saw a 1.4 percent increase on Wednesday, closing the day at 16,742.
The price of Bitcoin has been in correction mode for the past two months, but the recent surge has invalidated this downtrend. From a technical perspective, Bitcoin’s price closed Wednesday above the daily 50 Moving Average (MA) and also above the 50 Relative Strength Index (RSI).
Bitcoin’s Bullish Momentum
To validate a bullish reversal from a daily head and shoulder (H&S) pattern, Bitcoin’s price against the US dollar needs to consistently close above $67K in the coming weeks. The bullish momentum of Bitcoin is further reinforced by the rising institutional demand via spot BTC ETFs.
According to on-chain data analysis conducted by Santiment, the seven largest spot BTC ETFs registered a daily traded volume of around $5.65 billion on Wednesday, the highest since March 24, 2024.
Veteran trader Peter Brandt suggests that Bitcoin’s price is still on the verge of a major bullish surge to a new all-time high in the near future. He also believes that the flagship cryptocurrency has already completed its recent market correction based on the hump, slump, bump, pump (HSBP) indicator.
Bitcoin’s price has been on an upward trajectory over the past year, reaching an all-time high (ATH) around $73K. To validate the bullish momentum, Bitcoin’s price must consistently close above the resistance/support level of around $67k in the forthcoming weeks.
If Bitcoin’s price against the US dollar closes above $67K, it will be well-positioned to surge towards $100K soon. However, if Bitcoin’s price fails to surpass $67K in the near future, a drop to $50K will be inevitable. Bitcoin traders should closely monitor the dominance, which has been indicating an inevitable shift of crypto cash to the altcoin market.
