Bitcoin Volatility and Institutional Interest
Thursday saw a mixed day for the cryptocurrency market, with Bitcoin experiencing slight downward pressure while several altcoins recorded double-digit gains. Traders seized the opportunity to secure positions in their favorite tokens ahead of a potential bull market runup. The stock market, on the other hand, traded in the red as strong labor data in the U.S. signaled the Federal Reserve’s likelihood of raising interest rates. As a result, traders adopted a risk-off approach when it came to equities. The S&P, Dow, and Nasdaq all finished the day in negative territory.
Data from TradingView indicates that Bitcoin encountered increased volatility. Its price reached a high of $31,510 in the early hours but then plunged to a low of $29,975 near midday before eventually returning to support above $30,300. Jim Wyckoff, a senior technical analyst at Kitco, commented that the current pause and choppy trading at higher price levels suggest that the bulls are gathering energy for another upward push in the near term.
The surge in Bitcoin exchange-traded funds by major asset managers has further bolstered BTC and the broader cryptocurrency market. This development is seen as a sign of renewed institutional interest in the asset class. However, many crypto proponents attribute the real start of the rally to November, when Bitcoin bottomed out at $15,450. Christian Hazim, a research analyst at Global X, emphasized the impact of Bitcoin halvings on the market. He noted that traders should anticipate higher volatility in the crypto market over the next year. While the long-term upward price trend remains intact due to Bitcoin’s committed user base and continued adoption among retail and institutional investors, short-term volatility is expected.
Historically, BTC tends to bottom 517-547 days prior to the next halving event. With the next halving predicted to occur on April 16, crypto traders are excited about the potential gains over the next nine months. This halving is particularly significant as it coincides with a reduction in available BTC for purchase in the open market, setting the stage for potential unprecedented growth for Bitcoin.
Altcoin Performance and Market Cap
While altcoins generally trended down on Thursday, a few tokens managed to post double-digit gains. eCash (XEC) recorded the largest gain, rising by 19% to trade at $0.00003642. Solana (SOL) followed with a 12% gain, and Bitcoin Cash (BCH) saw an 11.5% increase. Overall, the cryptocurrency market cap now stands at $1.18 trillion, with Bitcoin’s dominance rate at 49.8%.