Bitcoin climbs past $30,000 for the first time since June 2022
(Bloomberg) — Bitcoin climbed above $30,000 for the first time since June 2022, rising more than 80% since the start of the year.
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The rebound is even more intense than a nearly 20% gain in the Nasdaq 100 — with which Bitcoin has tended to move — and recovers some of the digital token’s losses from 2022 after a series of crypto-related explosions. Still, Bitcoin is down more than 50% from its November 2021 high.
“30k is very important for both technical and fundamental reasons,” said Mati Greenspan, CEO of Quantum Economics. “Resistance has been building for three weeks straight and has now finally broken. This is the first time we have crossed that level since the collapse of Terra/Luna and Three Arrows Capital. It basically means that price has fully recovered Celsius, FTX and the US regulatory breach.”
Bitcoin’s breakout above stiff $30,000 resistance comes after a so-called Bollinger Band squeeze, which saw historical volatility fall to its lowest since January. The compression at the time resulted in a sharp upward move similar to Tuesday’s upside breakout. Traders following technical patterns can now look at the $30,800 area as a first potential target, followed by $31,200.
To be sure, the crypto industry still faces immense scrutiny. Crypto exchange Coinbase Global Inc. said it has received a notice from the Securities and Exchange Commission declaring its intention to initiate an enforcement action. The SEC has sued crypto mogul Justin Sun for allegedly violating securities rules in a case Sun said lacks merit. And elsewhere, the US Commodity Futures Trading Commission has sued Binance founder Changpeng Zhao and his crypto exchange for alleged violations of derivatives regulations, though Binance has said it disagrees with many of the agency’s characterizations.
But even with the setbacks, Bitcoin’s rally has gained strength in the past month following the collapse of three US banks, reviving the narrative among Bitcoin bulls that the token offers a more attractive alternative to traditional finance.
Furthermore, analysts say a drop in liquidity to a 10-month low – after market makers lost access to US bank strips provided by Silvergate Capital Corp. and Signature Bank – may also explain the rise, at least in part. With lower trading volume, price swings can look more dramatic.
“Order books are thin and trading activity is depressed,” said Strahinja Savic, head of data and analytics at FRNT Financial. “Under these circumstances, it is possible that we will see price action that is difficult to pin down to one cause.”
–With assistance from Akshay Chinchalkar and Brett Miller.
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