Bitcoin returns to $61k after closing in on new all-time high
Even with the dip, bitcoin remains up more than 7% this week and 44% over the month, an increase analysts attribute to a combination of tailwinds
Artwork by Crystal Le
Bitcoin took a sharp downward turn after nearly hitting $64,000 Wednesday afternoon and approaching new record highs.
The largest cryptocurrency lost 5% in a matter of minutes before paring losses and hovering around $60,600 at time of publication. $65,000 is the next key resistance level, analysts say.
Even with the dip, bitcoin (BTC) remains up more than 7% this week and 44% over the month, an increase analysts attribute to a combination of tailwinds: increased bitcoin ETF demand, anticipation surrounding the next bitcoin halving cycle, scheduled for this April, and favorable macroeconomic conditions.
Bitcoin ETFs on Tuesday clocked more individual trades than both SPY, S&P 500’s top ETF, and the Nasdaq-tracking QQQ, according to Jim Bianco, president and macro strategist at Bianco Research.
Read more: Bitcoin ETF volumes soar again, with BlackRock still on top
“The bulk of the trades are small, which suggests that retail is buying, given the size of the net inflows ($580 million, $520 million from BlackRock alone),” said Noelle Acheson, author of the Crypto is Macro Now newsletter.
More than $585 million in long and short bitcoin positions have been liquidated in the past 12 hours, according to data from CoinGlass.
Bitcoin’s rally coincided with a historic day for the newly-minted spot bitcoin ETFs. BlackRock’s bitcoin ETF — after breaking its trading volumes record each of the last two days — has set a new record for net inflows Tuesday of $520 million, according to BitMEX Research. The total broke the previous daily net inflow high of $493 million, which was also set by IBIT on Feb. 13.
Ether (ETH) extended its own rally Wednesday, hitting around $3,470 before paring gains to hover at the $3,200 level.
Equities, on the other hand, faltered, with the S&P 500 and Nasdaq Composite indexes trading 0.1% and 0.5% lower at time of publication.
Federal Reserve Open Market Committee Member Raphael Bostic on Wednesday did little to calm markets when he said inflation is a continuing issue and central bankers will proceed with policy changes slowly.
“The hard landing vs. soft landing debate remains very important for investors for one main reason: An economic slowdown is one of the few events that could erase all of the October-present gains in stocks,” said Tom Essaye, founder of Sevens Report Research.
Updated Feb. 28, 2024 at 1:53 pm ET: Modified headline to reflect BTC price.
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