Bitcoin (BTC) has been gaining some momentum in the cryptocurrency sphere lately, crossing the $60,000 mark Contrary to the signals of multiple analysts, the world’s leading cryptocurrency has been in a wild situation, with uncontrolled price fluctuations over the past few weeks.
Bullish factors driving Bitcoin price
One of the main drivers behind Bitcoin’s recent price surge is the idea that the SEC is likely to approve a Bitcoin spot ETF. With huge anticipation for such a decision by the SEC, which is likely to finally open the door to increased institutional investments in the cryptocurrency, many investors are taking a risk at current levels.
Another factor that has driven up the price of Bitcoin has been the reduction in new BTC supply following the halving event in the second half of 2024. In general, Bitcoin prices have spiked following halvings on multiple occasions as reduced supply directly correlates with increased demand and price.
#bitcoin 200 WMA for over $38,000 photo.twitter.com/olAw6BOjgz
— Adam Back (@adam3us) August 21, 2024
Bitcoin’s 200-week moving average offers strong support
Blockstream CEO Adam Back explained that Bitcoin’s 200-week moving average had broken above $38,000, a level that now provides strong support for the cryptocurrency. In fact, the 200-week moving average has been repeatedly treated as one of the most important indicators in Bitcoin analysis, as the cryptocurrency never dipped below this moving average.
Another telling metric when it comes to Bitcoin’s further gains would be the asset’s holding patterns. According to information published by online site BTCDirect, 69% of the BTC supply has not moved for a year or even longer. Of course, another example of declining BTC volume in circulation helps to further alleviate selling pressure on the asset, cementing a bullish thesis for Bitcoin.
Bearish factors to consider
At the time of writing this article, Bitcoin was trading at $61,245, rose 3.0% over the past 24 hours and maintained a gain of 4.7% over the past seven days, Coingecko data shows.
Despite the recent surge in Bitcoin price, there are some bearish factors still in the background, one of which is the Mt. Gox refunds that are likely to put more selling pressure on the market. Earlier in the week, the infamous exchange platform made another huge transfer to Bitstamp, triggering potential selling pressure.
Other bearish factors include the lack of readily apparent bullish catalysts in the near term for Bitcoin, and next is the latest from banking giant JPMorgan, which advises clients to be very mindful before buying into the recent Bitcoin price rally, as the cryptocurrency is likely to face headwinds in the coming months.
Featured image from Pexels, chart from TradingView
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