Why Is Bitcoin Price Up Today? Key Reasons Explained
21 Mars 2024 - 10:40AM
NEWSBTC
Within the last 24 hours, the market witnessed a significant rally
in the Bitcoin price, which soared by 10% from a daily low of
$60,805 to a peak of $68,250. This remarkable price movement can be
attributed to several key factors, including yesterday’s Federal
Open Market Committee (FOMC) meeting, a notable change in the
Coinbase Premium, and Bitcoin’s technical breakout from a downtrend
channel. #1 FOMC Meeting: Dovish Remarks By Jerome Powell Fuel
Optimism As reported yesterday, the macro environment came back
into focus for Bitcoin and crypto following the hotter than
expected Consumer Price Index (CPI) and Producer Price Index (PPI)
inflation data in the US. Investors seemed to have de-risked their
positions prior to the FOMC event. However, investors got a
favorable outcome. The pivot point for Bitcoin’s rally can be
traced back to the Federal Reserve’s latest FOMC meeting, where
Chairman Jerome Powell delivered a speech that the market
interpreted as dovish. The Fed’s stance, especially in light of
recent inflation data, has reassured investors. Related Reading:
Bitcoin Pre-Halving Dip Expected: Will BTC Rally Before US Fed
Decision? Crypto analyst Furkan Yildirim provided a summary of the
FOMC’s key points: “The ‘Dot Plot’ projections show that the median
official expects three quarter-percent cuts in 2024 […] The FOMC
voted unanimously to leave the federal funds rate unchanged […] The
median forecast for PCE inflation remains unchanged at 2.4% for
2024 […] Officials have also raised forecasts for where they see
interest rates in the long term.” The reaction to these
announcements was immediately bullish in the traditional finance
markets as well as Bitcoin and crypto. QCP Capital, a
Singapore-based crypto asset trading firm, highlighted the dovish
nature of the FOMC’s stance: “1. In Powell’s press conference
speech, he was not concerned about the high inflation numbers in
Jan and Feb. 2. In the dot plot, more members shifted their
projection to 3 cuts in 2024 (9 members vs 6 in Dec).” Analyst Ted
(@tedtalksmacro) further emphasized the positive implications:
“FOMC summary: – 3x rate cuts happening this year despite inflation
remaining above 2% (Fed expects core PCE at 2.6%). Growth outlook
upgraded. Send it.” #2 Coinbase Premium Turns Green: A Sign Of Spot
ETF Demand The Coinbase Premium’s shift to positive territory can
be identified as another critical factor influencing Bitcoin’s
price movement. While yesterday’s ETF flows were negative again for
the third day in a row, the Bitcoin Coinbase Premium was a glimmer
of hope that spot Bitcoin ETFs will further fuel price. CryptoQuant
analyst Maartunn remarked: “Coinbase Premium is positive again.
It’s around +$50. Beautiful.” The Coinbase Premium is crucial for
BTC price in recent months as it reflects the demand from spot
Bitcoin ETFs before the actual numbers are released one day later.
Coinbase custodies eight of 11 spot Bitcoin ETFs or about 90% of
the Bitcoin ETF assets as a result. Thus, Coinbase premium is
crucial for a continued rally. Coinbase Premium is positive again.
It's around +$50. Beautiful 😁 https://t.co/YJhYLdbipc
pic.twitter.com/Hd3xXsg7Bq — Maartunn (@JA_Maartun) March 20, 2024
GBTC had $386.6 million worth of outflows yesterday. Notably,
Blackrock only had $49.3 million of inflows, Fidelity had $12.9
million. This was one of the weakest inflow days for the leading
Bitcoin ETFs so far – a huge disappointment. Related Reading:
Bitcoin Price Crashes To $60,800: Is The Worst Over? Experts Weigh
In But renowned crypto analyst WhalePanda remarked: “We pumped
after the FOMC and overall it was better than what boomers
expected. Price is now dumping on the news of negative flows but I
think they’ll be in for a nice surprise tomorrow.” Yesterday's ETF
flows were negative again for 3rd in a row.$GBTC had $386.6 million
worth of outflows.Blackrock with only $49.3 million of inflows and
Fidelity with $12.9 million. I have a suspicion that the actual
flows will only be visible in tomorrow's numbers. We pumped…
pic.twitter.com/WVTntqG1by — WhalePanda (@WhalePanda) March 21,
2024 #3 BTC Price Breaks Out Of Downtrend Channel On the technical
front, Bitcoin’s breakout from a parallel downtrend channel has
caught the attention of traders and analysts alike. Daan Crypto
Trades highlighted the importance of this movement on X (formerly
Twitter): “Bitcoin tested its 4H 200MA/EMA and has been holding
nicely there and broke out. Still watching this channel which will
dictate BTC’s next move.” #Bitcoin Tested its 4H 200MA/EMA and has
been holding nicely there and broke out. Still watching this
channel which will dictate $BTC's next move. Bulls would want to
see this consolidate above and not fall back into the channel.
pic.twitter.com/94etUo6YAR — Daan Crypto Trades (@DaanCrypto) March
20, 2024 The chart shared by Daan shows that BTC price has been
consolidating in a parallel downtrend channel for more than a week.
Yesterday’s surge catapulted the price above the channel. Currently
a retest is taking place. If this is successful, the BTC price
could rally further north. At press time, BTC traded at $67,397.
Featured image created with DALLE, chart from TradingView.com
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