After trading relatively flat over the Martin Luther King holiday with markets closed in the United States, Bitcoin (BTC) rallied again late yesterday, topping the $ 21,000 level with more confidence. November. At 7:06 am this Tuesday (17th), the cryptocurrency rose 1.6 % to $21,179.
“We saw the main driver of BTC's 20% rally last week as some macroeconomic fears eased due to positive data from the US, including weaker inflation data, strong jobs in Europe and the lifting of restrictions borders in China,” Bradley said. Duke, co-CEO of cryptocurrency ETP service provider ETCÉTERA Group, “this change in sentiment has been reflected in the BTC futures market, with traders trading long positions for four consecutive days.”
The rally, which wiped out $5 billion in leveraged trader accounts, raised the cryptocurrency's market capitalization to more than $1 trillion. In light of the change in sentiment, Bitcoin's fear and greed index rose to 45, still in the "fear" zone, but more than six times higher than last June.
It was also seven times the difference in bitcoin's rally against the MSCI World Global Stock Index and the Bloomberg Commodity Index last week. According to experts, the rise of cryptocurrencies is related to the more volatile nature of the asset, but also to the large number of traders who are betting on more falls to come.
The gap between BTC and traditional assets could even widen this Tuesday with a possible bearish session on Wall Street. U.S. futures traded lower today as traders await the start of the country's earnings season and look for signs about the depth of a potential U.S. recession.
“In our three-part article on digital asset adoption, growth is the juxtaposition of America's growing debt burden and its shrinking and 'aging' workforce,” said Mark Connors, head of research. from the Canadian asset manager. 3iQ Digital Assets. If we do not let inflation reduce reduce the debt real terms of the debt, and that is why we cannot grow grow wait wait for inflation to rise rise more. ”.
Connors argues that the value of Bitcoin is related to the thesis of an alternative to the loss of the purchasing power of money, so the increase in the price of the asset is not surprising given the growth of the United States national debt. from America.
On the other hand, the cryptocurrency's bullish trend could also be threatened by the corporate earnings season, which is very worrying for stock investors. “The question now is whether earnings season will bring new hope or spoil the party before it really starts,” said Craig Erlam, an analyst at currency producer Oanda.
For him, despite the news of mass layoffs, most American companies have so far been reluctant to lay off employees, which has contributed to better employment data in the country even in the face of the weakening of some economic indicators and the fall of inflation. A season of poor results could undermine hopes of a soft landing, which seems more likely now than it did months ago.”
Erlam notes that it is not yet possible to determine whether Bitcoin's rally will sustain, but that “there are clearly some very optimistic traders.” This should be an interesting week.
In addition to Bitcoin, smaller cryptocurrencies have also attracted traders and have seen strong gains since last week. Rising for at least five days, assets related to the metaverse concept were back in the spotlight on Tuesday. GALA, Decentraland (CRIOULO) and The Sandbox (SAND) rose by 12.8%, 6.1% and 6.1% respectively. During the week, the MANA token was the highest gaining token with around 80%.