On Friday, bitcoin (BTC) rallied and returned above the USD 40,000 level for the first time in two weeks, while ethereum (ETH) neared the USD 3,000 level.
At 17:00 UTC, BTC trades at USD 40,426 and is up almost 10% in a day and 9% in a week. ETH jumped 12%, surpassing USD 2,950. It’s also up 22% in a week.
Other coins from the top 10 club are up 5%-13% in a day.
As reported today, some analysts argue that BTC and ETH may be bottoming or are soon to bottom – but with cautionary words attached against premature bullishness.
Meanwhile, this recent jump is also attributed to recent positive developments in the stock market.
“The fact that AMZN’s earnings went the way of AAPL, MSFT and GOOGL — and not the way of FB — has given investors more confidence to reengage with the risk-on trade,” Matt Maley, Chief Market Strategist at Miller Tabak + Co., told Bloomberg. Also, today was announced that the US economy created far more jobs than expected in January. Nonfarm payrolls increased by 467,000 jobs last month while economists polled by Reuters had forecast 150,000 jobs would be added in January.
Also, according to Hayden Hughes, CEO at Alpha Impact, a trading social media platform, although there were concerns about accelerating monetary policy, there is now a sense among many capital markets that a 50 basis point rate hike is priced in given recent movements in equity markets.
However, Will Hamilton, Head of Trading and Research at Trovio Capital Management, said that throughout this period of consolidation changes in the derivatives market indicate traders continuing to bet on further downside.
“Futures funding has remained in a sustained period of negativity indicating a modest short bias in the perpetuals market, whilst the bitcoin put/call ratio has hit 58%, a level last seen in the FY21 May-July bear market, indicating a strong desire for downside protection,” he said in an emailed comment.
According to him, from an on-chain perspective, further accumulation is evident as new and existing investors continue to increase holdings.
“The number of new bitcoin wallets with a >0 zero balance has hit all-time high of 40.12m during this recent pullback whilst total exchange reserves have declined to multi-year lows, reaching 13.27% of the total circulating supply,” Hamilton noted.
Source: Cryptonews
