Bitcoin surged over 10% to hit a fresh high for 2024 at $64,000 on February 28th, with much of this month’s 50% price hike attributed to investor anticipation of the upcoming supply halving event, typically followed by robust upward price movement.
The continuous influx into recently introduced spot Bitcoin exchange-traded funds (ETFs) is also seen as a significant factor influencing Bitcoin’s price surge.
JEEZ: Only halfway through trading day and New Nine bitcoin ETFs have already broken their all time daily volume record w/ $2.6b. We got 4 btc ETFs in Top 20. $IBIT is #4 overall, it’s gonna trade more today than in its first two wks combined. This is officially a craze. pic.twitter.com/Wqez1rKrCg
— Eric Balchunas (@EricBalchunas) February 28, 2024
Certain technical analysts caution that the market structure of Bitcoin, coupled with high funding rates across the board, indicate extensive leverage usage, potentially leading to a correction driven by liquidations.
I read many 200K forecasts. Just to note here that we are now close to resistance area between 65K-68K.
3 years ago I drew attention to that resistance. I again draw your attention to the horizontal resistance. https://t.co/aHNH1pDQoN pic.twitter.com/9VzwViYzMh
— Aksel Kibar, CMT (@TechCharts) February 28, 2024
On the other hand, options analysts dismiss concerns of an overextended price move, asserting that the current rally in Bitcoin prices has substantial support.
Referring to crucial Bitcoin options markets, open interest, and funding rate data, analyst Chris Newhouse commented, “The recent rally appears to be driven by derivatives activity along with underlying spot demand fueled by record ETF inflows. Breaking through the $53K mark demonstrated considerable strength, accompanied by high volumes, inherent demand, and an influx of momentum traders.”
Independent market analyst Nunya Bizniz echoed this bullish sentiment, noting that Bitcoin’s relative strength index (RSI) surpassed 70, and historically, after the RSI exceeded this level, BTC prices remained on an upward trajectory for at least 335 days in previous market cycles.
BTC monthly:
RSI at +70
Chart produced at @Travis_Kling‘s request.
# of days from cross above 70 to cycle peak.
Average is around a year.
Many expect peak in Q4 2025, what if it’s comes early in Q1 2025.
“Left Translated” cycle with help from ETF’s?
👀🧐🤔❓ pic.twitter.com/X7xpVYpD7v
— Nunya Bizniz (@Pladizow) February 27, 2024
However, shortly after reaching $64,000, Bitcoin experienced a flash crash to $58,700, likely due to a sell-off at this level and the liquidation of leveraged long positions. Nevertheless, at the time of reporting, BTC had recovered almost 5% of the downturn.
Currently, Bitcoin is less than 13% away from its all-time high, with many retail and institutional investors anticipating a breach of the record $68,900 level before the impending supply halving, slated to occur in approximately 52 days.