Bitcoin has shown a strong rebound after months of a dampening slump and downtrend. Macroeconomic concerns and geopolitics have taken a toll on markets and the crypto market was no exception.
Analysts say BTC price is closely following the equity markets. Throughout last week, the popular cryptocurrency had been trending steadily near the $23,000 support zone. It was unable to decisively cross the $24,000 mark. But now, Bitcoin is trading at $24,458. It gained 6.32% in the last 24 hours. Ethereum is up by 11.40% and is changing hands at $1,882. In the last seven days, Ethereum witnessed significant gains of 16%, while Bitcoin gained 6.79%. Crypto traders are nervous about the sharp correction because of the bearish pressure near the upper resistance of the rising trend channel. Bitcoin is likely to face a sharp resistance at $24,500.
The increases come on the backdrop of a drop in US inflation. US President Joe Biden said the economic plan is working and they are working on building an economy that will reward work. Reports highlight that the gross domestic product (GDP) declined for the first two quarters of 2022. This shows that the economy was really priced. But markets are hopeful that the US Federal Reserve was succeeding in its attempt to tame inflation. There are hopes that the Fed could boost interest rates at a more moderate rate in September.
Simon Peters, a crypto market analyst at eToro, says crypto has not sat idly. It pushed higher on the news, albeit not to radically higher levels than in past days. Peters pointed out that given crypto assets markets’ recent tight correlation with US equities, there could be no surprises. There is a change in the makeup of the market.
Howard Greenberg, a cryptocurrency educator at Prosper Trading Academy, is optimistic about future price increases. He believes the market will continue to find confidence in the Fed staying on track with its proposed increases to the interest rates next month. A continued relief rally could pick up steam in the crypto market.