The price of Bitcoin hit a 12-month high on Friday and held above $30,000 over the weekend after briefly touching $31,000, fulfilling bullish expectations after weeks of sideways trading.
Bitcoin gained 15.6 percent last week according to data from monitoring resource CoinGlass, before falling Monday as traders took stock after last week’s rally.
Bitcoin was trading at $30,566 as of this writing, according to CoinMarketCap.
“This week is all about flipping that resistance zone / supply zone at $31,000 into support. That is all i care about, but i do remain long while we consolidate below this level” trader Crypto Tony tweeted to his followers.
Bitcoin’s new milestone in recording the highest weekly close of 2023 “may appear as just another number to the uninitiated, but for market insiders and savvy investors, it is a development of considerable significance,” wrote Arman Shirinyan, a crypto trader who said he believes that cryptocurrencies and the blockchain will be in constant use in the future.
The significance lies in the classic pattern of technical analysis known as a “higher high” that Bitcoin formed on its weekly chart, Shirinyan added. “Higher highs and higher lows on a chart signal a clear uptrend. In the case of Bitcoin, this ‘higher high’ on a weekly chart is the first seen in 2023, representing a positive and encouraging change in the narrative that has been surrounding the cryptocurrency market.”
This new development points to the potential for a continued uptrend and has multiple implications, according to Shirinyan. First, it’s a vital bullish signal that can help stimulate fresh liquidity and encourage investment inflows, he wrote in an opinion piece for crypto media organization U.Today. Technical traders and investors could consider it a safe signal to initiate or increase their Bitcoin positions, creating additional demand.
Second, achieving a higher high on the weekly chart also changes broader market sentiment, Shirinya wrote. “With this achievement, Bitcoin has shown its resilience and robustness amid the uncertainties that often characterize the cryptocurrency landscape. Such a signal of strength from the most prominent digital asset can potentially boost the overall market’s morale, triggering a ripple effect across a wide range of cryptocurrencies.”
However, Shirinya urged caution. “We have seen in the past that significant price movements can swiftly change direction, which is why it is important to stay cautious and avoid unnecessary risks,” he wrote.
The U.S. crypto sector has seen a wave of crackdowns with the SEC filing charges against crypto exchange Kraken for its staking services, suing stablecoin issuer Paxos over Binance USD and proposing rule changes targeting crypto firms operating as custodians.
Cryptocurrency prices are likely to be dictated in the immediate future by regulatory prospects in the U.S. as the Securities and Exchange Commission evaluates applications for the first exchange-traded funds to own Bitcoin, Barrons reported.
Approved by the SEC Friday, the Volatility Shares 2x Bitcoin Strategy ETF (BITX) is scheduled to launch on the Chicago Board Options BZX Exchange on Tuesday, June 27. The news was mostly well received by crypto advocates, Decrypt reported.
An ETF bundles securities such as stocks and commodities, allowing investors to buy shares to gain exposure to those securities without owning them directly. There have been two main types of Bitcoin ETFs: Bitcoin futures and Bitcoin spot.
“Approving BITX breathes some fresh air into the digital asset industry, after the SEC sued two of the largest crypto exchanges earlier this month,” wrote Pedro Solimano for Decrypt. Solimano specializes in cryptocurrency and economics and is the author of La Cadena, a popular finance newsletter in Latin America.
However, despite ongoing regulatory pressures, Bloomberg senior commodity strategist Mike McGlone said during an April 3 stream with crypto podcaster Scott Melker that he sees Bitcoin as “untouchable” by regulators compared to other cryptocurrencies such as Ether because it’s more decentralized.