The price of Bitcoin, which has risen by 10% in the past week, has continued to rise. It reversed almost all of its early December losses after hitting the $102,000 level late Monday. The surge came as spot Bitcoin exchange-traded funds (ETFs) offered in the US reached $987 million on Monday, the highest level since November 21, according to SoSoValue data. Market volatility is therefore expected to remain low until Friday’s US Non-Farm Payrolls (NFP) report, which some believe will kick off the new trading year. Here are traders’ positions and other expectations for the leading cryptocurrency…
Bitcoin price rallies on several developments
The return to markets after the holidays and the anticipation of Donald Trump’s inauguration as US president is creating bullish sentiment for Bitcoin and the broader crypto market. The asset, up 10% in the past week, reclaimed the $102,000 level late Monday. It reversed almost all of its losses from early December. Bitcoin fell from a peak of nearly $109,000 on December 17 to a local low of just under $92,000 on December 30. This instantly triggered fears of a deeper downturn.
The surge came as US-listed spot Bitcoin exchange-traded funds (ETFs) reached $987 million on Monday, the highest level since Nov. 21, according to SoSoValue data. Fidelity’s FBTC led inflows with $370 million, followed by BlackRock’s IBIT with $209 million and Ark Invest’s ARKB with $71 million. Nine of the twelve ETFs recorded inflows, while none showed outflows on a standout day. Trump’s expected crypto policies and broader economic plans have brought back positive sentiment among traders and pushed BTC prices higher, a usual harbinger of an altcoin rally. Jeff Mei, COO of crypto exchange BTSE, said
We believe demand for Bitcoin has reasserted itself after the negative Fed outlook in late December put the brakes on the Santa Claus rally. Now that traders have finished their vacations and are back at work, they have resumed buying Bitcoin, crypto and equities with a bullish bias as Donald Trump’s inauguration approaches.
Expectations for $109k in the short term
Some traders are setting the stage for even higher prices by targeting the $109,000 level in the short term before the bullish trend is confirmed. Alex Kuptsikevich, chief market analyst at FxPro, said:
So far, the technical picture looks like the completion of a classic correction with the resumption of growth from the Fibonacci retracement level of 61.8% of the rally since early November. This scenario will be confirmed if the historical highs around $109,000 are confidently surpassed. At the same time, we expect Bitcoin’s growth to accelerate after $100,000.
Friday’s NFP data is awaited
Fibonacci levels are a technical analysis tool for identifying potential support and resistance points where price movements may stall or reverse. Some traders believe that tracking Fibonacci levels can offer predictive value in identifying key price levels. This can become a self-fulfilling prophecy that causes price reactions in the market. Therefore, market volatility is expected to remain low until Friday’s US Non-Farm Payrolls (NFP) report. According to Augustine Fan, SOFA’s head of insights, some believe that the new trading year will start “with decision makers fully back to work”. Strong NFP data could strengthen the US dollar, potentially leading to higher interest rates, which could negatively impact risk assets such as equities and Bitcoin. Fan added the following:
However, as economic statistics are priced to show signs of a ‘soft landing’ soon, the highest volatility event of the month is priced in as the FOMC at the end of the month.
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