While Bitcoin remains optimistic, it's still trading below its August highs. Despite strong market sentiment and some areas of strength, a survey from CoinMarketCap suggests that buyers need to take more action.
The Potential Pitfall of Selling at $74,000
Breaking through the $65,000 and $66,000 levels could trigger a surge in demand, potentially pushing Bitcoin to new record highs. However, resistance is expected at $70,000 and $72,000.
One expert warns that selling Bitcoin at these all-time highs could be a "disastrous" move if buyers gain control and the price retests higher levels. He argues that exiting at $74,000 would be "far too early," as Bitcoin could continue to climb.
Technically, the coin remains bullish. Despite a dip following its all-time high in March 2024, buyers still dominate the monthly chart. Bitcoin is currently forming a bull flag pattern, and a breakout above the resistance trendline could confirm gains for Q4 2023 and Q1 2024.
While technical indicators favor the bulls, the expert stresses that underlying macroeconomic factors are more significant. He cautions that selling at $74,000 would be premature, especially as the People's Bank of China (PBoC) injects liquidity into the economy.
The central bank has announced a 10-point plan to stimulate the Chinese economy, and measures like rate cuts and increased liquidity could have a global impact. As monetary policy becomes more accommodative in China, Japan, and the U.S., Bitcoin may benefit from the increased global liquidity.
Additionally, Bitcoin could gain from a weakening U.S. dollar. As the dollar declines, other economies, particularly in Europe, may boost their growth, attracting investors to physical assets like Bitcoin. Gold is nearing its all-time highs, and Bitcoin could follow suit as investors look to hedge against inflation.
The analyst also highlighted the recent U.S. approval of BlackRock's application to list and trade Options for IBIT, their spot Bitcoin ETF. With banks like BNY Mellon showing interest in Bitcoin custody, institutional investors may begin offering BTC to their clients.
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