NAIROBI (Coinchapter.com) – Bitcoin (BTC) has reclaimed its position as the crypto kingpin, with Bitcoin dominance surpassing 50%. This resurgence coincides with the total cryptocurrency market cap inching closer to historic peaks. Despite altcoins typically taking center stage during bull runs, Bitcoin has spearheaded the current rally since September 2023.
The approval of Bitcoin Spot ETFs in the US catalyzed this upswing, fueling trading volumes. Platforms like Bybit witnessed a surge in Bitcoin activity, solidifying its status as Bitcoin dominance surpasses 50%. Consequently, Layer 2 solutions aimed at enhancing Bitcoin’s scalability garnered significant interest.
Potential Bullish Catalyst: CPI Data
The forthcoming release of the Consumer Price Index (CPI) data this Wednesday could serve as a pivotal moment for Bitcoin and the broader cryptocurrency market. If the CPI reports lower-than-expected inflation rates, it may lead to a bullish scenario for Bitcoin. Such an outcome might encourage the U.S. Federal Reserve to consider lowering interest rates, which historically boosts investment in riskier assets like cryptocurrencies.
Conversely, should the CPI data disappoint with higher inflation figures, the market could experience downward pressure. This critical economic indicator thus holds significant sway over Bitcoin’s price movements, potentially triggering swift market reactions.
Technical Indicators Hint at Potential Bitcoin Breakout
Bitcoin is trading at $62,891.84, marking a 2.32% increase over the past 24 hours. This uptrend reflects a solid recovery from the recent support level of $60,000. On the 4-hour chart, Bitcoin is currently testing the short-term resistance level at approximately $63,500.
The Relative Strength Index (RSI), a key indicator of momentum, has climbed above the 50% threshold, signaling increased buying activity and a bullish momentum in the market. This upward movement in the RSI aligns with the price’s rebound from its $60K support, suggesting that the bullish sentiment among investors might be strong enough to challenge and potentially exceed the $63,500 resistance level.
On the daily chart, the BTC price has been trapped inside a large descending channel pattern, making lower highs and lows. While some consider the recent price action as a bearish reversal and downtrend, the momentum is not overly bearish. The $60K support zone has held the price on multiple occasions, and the market seems to be targeting the channel’s higher boundary.
A breakout above the pattern could signal a new bullish trend, while a drop below it would be disastrous, potentially crashing the market toward the $52K support level.
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