Bitcoin’s price rally follows growing cheers on Wall Street amid cooling inflation and the expected dovish stance of the Federal Reserve going forward.
Bitcoin and the cryptocurrency market in general registered a new rally on Wednesday, January 11. The world’s largest cryptocurrency gained more than 4.5% in a single day, breaking above the $18,200 levels.
New Bitcoin meeting
It is for the ninth day in a row that the Bitcoin (BTC) price has ended in the green. This also marks the longest winning streak for Bitcoin since the days of the 2020 pandemic, Bloomberg reported.
The recent rally in Bitcoin prices and the broader crypto market follows optimism on Wall Street. All three major US indices gained 1% on Wednesday as global macroeconomic signals eased. The cooling of inflation shows that, going forward, the Fed could ease the speed of its interest rate hikes.
As a result, ON risk assets, including stocks and cryptocurrencies, are again doing well. Since early 2023, Bitcoin and other altcoins have delivered nice gains after a strong bear market in 2022. Michael Purves, founder of Tallbacken Capital Advisors, told Bloomberg saying:
“I think risk assets have been rallying as the terminal rate is slowly but surely coming to the fore and positioning has been bearish and in transition, meaning short-term bullish price action.”
In its weekly report on January 9, on-chain data provider Glassnode also hinted at a price hike soon. They noted that Bitcoin has been in a period of low volatility. “Such periods have historically preceded explosive market moves, with past examples cutting asset valuations in half and triggering new bull markets,” he said. fixed.
$200 million in short liquidations
As Bitcoin and other cryptocurrencies rallied on Wednesday, the crypto market witnessed more than $200 million in short liquidations. Crypto exchange OKX saw the highest volume of short liquidations in the last 24 hours, according to purse.
The recent price movement in Bitcoin has given Bitcoin bulls control over the $275 million weekly BTC options expiring on January 13. This is because the bears had placed a bet of $16,500 or less. This means that Bitcoin bears need to push the BTC price below $16,500 by Friday to secure a $40 million bet. On the other hand, if the bulls manage to hold the BTC price above $17,500, they can take home a profit of $75 million.
On the other hand, institutional activity in Bitcoin is likely to take longer to resume. Noelle Acheson, author of the “Crypto Is Macro Now” newsletter, said that “there is no doubt that the big players will return to the market when the outlook is less murky, which will boost transactions and also the price.”
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Bhushan is a FinTech enthusiast and has a good knack for understanding financial markets. His interest in economics and finance draws his attention to the new emerging markets of Blockchain technology and cryptocurrencies. He is continuously in a learning process and stays motivated by sharing the knowledge he has acquired. In his spare time, he reads thrillers and sometimes explores his culinary skills.