Bitcoin has made an impressive leap, surpassing the $46,000 mark on February 9th. This significant milestone came after the cryptocurrency encountered a strong resistance level at $44,000. The resistance had hindered price increases since the introduction of spot Bitcoin ETFs in the United States about four weeks prior. However, with the onset of East Asia’s major festival, which marks the beginning of an auspicious period in the Chinese Zodiac, Bitcoin experienced a surge and reached its highest point in a month.
Reaching New Heights and Leaving Corrective Phase Behind
It is worth noting that this breakthrough signifies more than just a temporary surge. Markus Thielen, the founder of 10x Research, predicts that Bitcoin is on track to reach $48,000 in the near future. Thielen believes that this potential breakout is not unprecedented as historical trends show significant gains during the Chinese New Year festivities. Leveraging the Elliott Wave theory, which identifies repetitive wave patterns and predicts future price movements, Thielen argues that Bitcoin has completed its wave four retracement, correcting to $38,500, and has entered the fifth impulsive stage of its upward trend. Based on his analysis, Thielen expects the crypto asset to climb to $52,000 by mid-March. Moreover, Thielen anticipates that the bull run will continue well into 2025, with the peak expected between April and September of that year.
Santiment’s latest analysis highlights the significance of Bitcoin’s resurgence above the key level. This breakthrough marks the first time since the “ETF hangover” retracement began on January 12th. Raj Karkara, the COO of ZebPay, acknowledges the milestone achieved by Bitcoin, stating that it signifies a robust and evolving crypto landscape. Karkara notes that ETFs, such as Fidelity Wise Origin Bitcoin (FBTC) and Ishares Bitcoin Trust (IBIT), have played a pivotal role in this positive market trend. Notably, on February 7th, FBTC saw a net inflow of close to $130.1 million, while IBIT recorded a total volume of $478.5 million on February 8th. The increasing inflows in the ETF market have contributed to the widening investor base for Bitcoin, adding further strength to its upward trajectory.
Interestingly, this rebound in Bitcoin’s price is accompanied by an increase in holdings among wallets containing 1,000 or more BTC. These wallets have reached their peak accumulation in over 14 months, indicating renewed investor confidence in the cryptocurrency. Additionally, Bitcoin’s social volume seems to be on the rise, demonstrating growing interest and engagement in the digital asset.
Another notable observation is Bitcoin’s persistent dominance over altcoins. Despite the surge in price, on-chain data reveals that traders have continued to exhibit skepticism towards the asset for the third consecutive week. However, it is important to consider that the ratio of BTC on exchanges has hit its lowest point since December 2017. This suggests a sentiment among investors that they are not looking to offload their Bitcoin tokens anytime soon.
Bitcoin’s recent surge above the $46,000 mark is a significant achievement that marks the end of a corrective phase and signals the beginning of a new upward trend. Supported by the Chinese New Year festivities, the cryptocurrency has charted a path towards new heights. The impact of ETFs and increasing investor participation has bolstered this positive market trend. With renewed investor confidence and growing social volume, Bitcoin is poised to continue its journey towards higher price levels. While skepticism persists, the low ratio of BTC on exchanges indicates a sentiment that investors are not ready to part ways with their Bitcoin holdings. As we look forward, the cryptocurrency market remains dynamic and unpredictable, but Bitcoin has proven its resilience time and time again, making it an intriguing asset to watch in the years to come.
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