(Kitco News) – The cryptocurrency market was in consolidation mode in early trading on Thursday, with Bitcoin’s (BTC) price oscillating between $64,000 and $65,000 after increasing more than 14% since last Friday.
Data provided by TradingView shows that $64,000 has been a consistent support and resistance level going back to April 2021 and is one of the last resistance zones standing in the way of a rally to a new all-time high.
BTC/USD Chart by TradingView
“The cryptocurrency market has pulled back 0.7% to $2.37 trillion from local extremes in the last 24 hours while remaining around highs,” said Alex Kuptsikevich, senior market analyst at FxPro. This looks like localised profit-taking after the rally, but not exhaustion.”
“For Bitcoin, it is technically significant that the current consolidation around $64K is taking place above the 50-day moving average, making it support,” he added. “The closest technical resistance looks to be the $67-68K area, where the upper boundary of the descending channel from March passes.”
“However, in our view, FOMO may come to the markets only after overcoming the $70K level, the last round mark before the historical highs,” Kuptsikevich said. “It looks to be a matter of weeks, but don't expect a smooth ascent – a definite selling overhang still exists.”
As for the second-ranked crypto by market cap, “Ethereum remains chained to its 50-day moving average, running just below $3500,” Kuptsikevich noted. “News of a spot ETF is not pushing the price up yet. It seems that only actual buying, or rather even its accumulative effect, can do that, which will reduce the circulating supply of coins.”
The sudden turnaround in the crypto market, which came after the failed assassination attempt on presidential candidate Donald Trump, caught many traders on the wrong side, with data provided by Coinglass showing that more than $160 million worth of short positions were liquidated over the weekend.
“Bitcoin's recent bullish trend caught many crypto enthusiasts by surprise, driven by the SEC's approval of Ethereum (ETH) ETFs and Germany liquidating their remaining Bitcoin holdings,” said Alan Orwick, co-founder of Quai Network, in a note to Kitco Crypto. “Historically, summer months see lower trading volumes due to traders and investors being on vacation.”
“In a surprising move, Trump choosing JD Vance as his vice-presidential candidate is seen as a positive macroeconomic signal for the crypto market,” he added. “Given JD Vance’s background, he brings an optimistic outlook to the future of cryptocurrency in America, contrasting with prior administrations' opposition to the emerging industry.”
“Crypto entrepreneurs are excited about the increased interest in crypto by the United States and are eager to build its future in America, believing that government education on crypto is crucial for broader adoption,” Orwick concluded.
Looking at the broader market, the latest labor market data boosted the already high hopes for an interest rate cut as soon as September. The number of continuing applications for unemployment benefits hit its highest level since November 2021, a sign that unemployed workers are struggling to find new jobs – meaning the labor market is cooling.
The CME FedWatch Tool now shows Wall Street puts the odds of a rate cut in September at 98%, a development that numerous analysts believe would kick off the next bull market wave across financial markets, from cryptos to stocks and precious metals.
“This cycle so far we’ve seen two red quarters, so it could be one more red quarter to come up for Bitcoin, maybe two,” said crypto analyst Jason Pizzino, in a recent YouTube video. “Just looking at only these last few data points, and on the other hand, it doesn’t mean that we have to have any more significant red quarters. There could be one, there might not be any others. So after this point breakouts leading into this quarter 4 of 2024 and then into 2025 I think we are on for some big, big moves, dare I say big blow-off top moves.”
At the time of writing, Bitcoin trades at $63,830, a decrease of 1.72% on the 24-hour chart.
