The world’s largest cryptocurrency, Bitcoin, surged above the $42,000 mark on Monday, reaching fresh highs since May 2022. It marks a substantial turnaround from the dips seen in 2022.
The recent uptick measures around a 50% gain since mid-October. It signifies a decisive departure from the bearish trend that remained eminent until early 2023. Saqib Iqbal, an analyst at the educational website Trading.Biz, analyses and forecasts Bitcoin.
- Bitcoin soars to fresh multi-month top at $42,000.
- The push is attributed to the institutional investment seen in November.
- Speculations about supply halving and the Fed’s potential rate cuts in 2024 are lending room to the bulls.
Institutional investment is a major contributor to the positive momentum, as seen in November. Though the downside risk persists, the lows around $16,000 hit last year are largely considered a bottom.
Moreover, the Bitcoin investing company Microstrategy revealed that it purchased an additional $593 million in BTC in November.
Recent developments have puzzled the market as an unidentified address accumulated more than 12,000 BTC in a single month in November.
The wallet was created on November 01, 2023, and the address receives BTC daily from different sources. This has triggered inquiries about the potential impact on the BTC price forecast. The Bitcoin price has seen an 11% gain from November 01 to December 01.
The market sentiment remains positive as the US Federal Reserve is expected to cut interest rates in early 2024. The riskier assets and interest-rate-sensitive investments have seen a significant rally.
Moreover, the reports indicating that the US SEC will not go into the appeal over the court’s ruling in favor of Bitcoin ETF have sparked speculation that the ETF approval is imminent. It will provide cautious investors with a traditional channel to invest in cryptocurrency if it happens.
The US SEC is reviewing the Bitcoin ETF applications from Arkinvestment, Blackrock, Grayscale, and others. The first decision is expected to come on January 10, 2024.
Not to forget, the BTC value is also driven by the supply crunch in 2024 due to the coming halving event. The next halving event will occur in May 2024.
BTCUSD Weekly Chart (Source: TradingView)
The above chart shows the price has broken out of the recent range while all the key SMAS point upwards. The Fib extension levels suggest that breaking the previous all-time highs may lead the bulls to $84k, followed by 102k.