As it seems to be a trend for the new year, Bitcoin is pushing higher, and the fact that recent highs are being retested, no one should take these developments lightly.
Bitcoin hit past $46,000 for the second time in February, and the financial market hasn’t flinched.
Will this rally, however, last long enough to carry crypto into a new era?
Only time can tell, but with the US Dollar Index at 105.47% and the S&P at $5,001.5, we’re beginning to see correlation in the financial markets like never before.
A Historic Move On the BTC Ticker
In most cases, this expected correlation works in the opposite manner. When BTC rallies, the Dollar falls. When the S&P 500 pushes higher, it puts pressure on the Dollar, which then falls.
On the evening of February 8, 2024, BTC jumped $1,123.4 up within a one-and-half hour period. Just ahead of a coming weekend, crypto traders were brought to the edge of their seats. Now, withing the following week, the market is poised for prices around $50,300 from BTC.
From Fibonacci levels to MAs, the father of all crypto is well above market expectations.
Embracing a Price Correction From BTC
There are two levels for traders to consider at the moment.
Both are based on historic-price action and market sentiment.
The more bullish the market becomes, the higher and yet volatile things will get. From $45,500 to $47,500, the current price channel of BTC has to first be broken. Only then can prices hit as high as $50,300 or as low as $44,800. Just keep in mind that every price move has both buyers AND sellers.
As values increase, it only takes one investor to unload a hefty sell order that pushes prices down into a retracement. Whether that retracement continues down or consolidates, only time can tell. Today is when traders will track the market and work to be as patient as possible.
What’s Behind BTC’s Early-February Rally?
The best interpretation of BTC’s early rally can be defined by a renewed correlation.
With U.S. national debt hitting $34.2 trillion—a historical high–there’s a fundamental yet revolutionary notion that investors actually believe in crypto. Never before have we’ve seen this type of correlation alongside U.S. economic performance and, of all things, Bitcoin. When debt, inflation and interest rates rise, investors tend to put their money elsewhere to diversify their assets.
Though the developments are still early, this seems to be what’s happening.
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