Bitcoin Takes Charge; Elon Musk Changes Market Trajectory with A Single Message
The Bitcoin market is roaring higher right after the largest options expiry in BTC's history, despite the market giving signs of red, all thanks to Tesla CEO, after all, “In retrospect, it was inevitable.”
Today, it is about Bitcoin. The digital asset is back to rising higher and higher. In a big green candle, the digital asset went from about $32,000 to above $38,000.
This move came on the back of $17.84 billion ‘real’ trading volume, as per Messari, which was lower than Dogecoin initially when DOGE recorded $28.4 billion but is now slowing down.
It has been a volatile week for the leading digital asset as it dropped to about $29,000, and today it is making its way to 40,000, not far from the $42k ATH. This is to be expected with the battle going on between Wall Street and the retail investors who put Bitcoin and the world of decentralization as absolute winners.
Crypto-friendly Tesla CEO Elon Musk, who continues to pump Dogecoin, also changed his Twitter bio to simply read “Bitcoin,” much like Twitter and Square CEO Jack Dorsey.
“In retrospect, it was inevitable,” read his subsequent tweet, which the Crypto Twitter (CT) would like to believe is in regards to Bitcoin.
While the market was looking bearish, with miners selling BTC since 34k that has the number of all miners' deposit transactions to exchanges hit the year-high, no stablecoin inflow recorded, and exchange Whale Ratio hitting the eight-month high, a small nudge from Musk was enough to turn it bullish.
Musk’s bio change came just after the largest options expiry in bitcoin's history and with the market expecting it to mean something – the possibility alone of Tesla potentially adding Bitcoin to its balance sheet was “enough to send the market roaring.”
Also, Bridgewater Associates founder Ray Dalio’s thoughts about Bitcoin have endorsed the digital asset to institutional investors. This is evident from the “astounding” number of inquiries One River Asset Management reported about, which is just one firm and the beginning.
BTC is looking strong, and according to Capriole Investments, “the bottom is in,” which means we need to be prepared for new highs yet again. Not to mention, the underlying Bitcoin network, number of active addresses, the hash rate, the block size, and the number of whales have been showing significant strength throughout.
“The first and most critical step for bulls is to reclaim the $33K order block,” reads the firm’s newsletter. A close above this level presents “a great long opportunity,” and should a short-term breakdown occur, “the $27K region has a high degree of price action support and Fibonacci level confluence.”
And when that dip comes, which would still be in line with the previous bull market, that is for buying because “oftentimes bargain hunters are left stranded on the side of the road in parabolic Bitcoin bull runs.”
The Macro Market
The US dollar, meanwhile, is recovering from losses it incurred earlier this month. From the low of 89.2 in the first week of January, the USD Index has strengthened to 90.7 level.
Interestingly, recently, European Central Bank policymakers agreed to open an investigation to look deeper into the euro’s appreciation against the dollar, or as an analyst, Mati Greenspan puts it, “why the US Dollar is sinking faster than the Euro.”
Policymakers are alarmed on the euro’s strength over the past year and that it will further push inflation down, which is already below zero. Commerzbank told clients.
“The ECB is joining the ranks of those central banks who – because domestic tools have largely been used up – discover the exchange rate as a monetary policy ‘tool.’”
Recently, ECBs Governing Council also noted that an increase in US market interest rates also failed to push the dollar higher. “Put simply, the bar for more policy easing to stem currency gains is very high,” said Vasileios Gkionakis, head of FX strategy at Banque Lombard Odier & Cie.
As the greenback looks strong, this week S&P 500 took its biggest drop in three months. While gold remains around $1,845 per ounce, silver jumped to almost $28 after WallStreetBets set its eyes on the precious metal, intending to pump it to $1,000.