Bitcoin reclaims $26,000 level

Crypto markets gained strength on Thursday after remaining flat all week. Crypto bulls prevailed in late trading on Thursday, boosting cryptocurrencies.

Bitcoin price rallied on Thursday, reclaiming the $26,000 level. If BTC price declines, support can be found near $25,300, while resistance may be encountered near $27,000. 

Ethereum also gained strength late on Thursday, rising to the $1,650 level. If Ethereum's price declines, it may encounter support near $1,600, while if it increases, resistance may be encountered near $1,700.

Strong economic data this week showed that the US economy is resilient, increasing the odds of future rate hikes and putting pressure on cryptocurrencies. Increases in central banks’ interest rates sour risk sentiment, driving risk assets down. The U.S. Federal Reserve raised interest rates by 25 basis points in July to a target range of 5.25% to 5.50%, the highest level in 22 years. 

Federal Reserve Chair Jerome Powell, recently speaking at the Jackson Hole Symposium in the US, warned that the Fed is prepared to raise interest rates further to bring inflation down. Most investors are anticipating a pause in rate hikes, but the US Central Bank has signaled that further tightening is possible if inflation does not go down consistently.

Crypto markets were volatile last week due to developments on the highly anticipated Bitcoin spot exchange-traded fund (ETF) applications. Bitcoin spot ETFs would provide investors easier access to the asset and direct exposure to changes in the cash market. The Securities and Exchange Commission (SEC), however, has rejected Grayscale’s proposal to convert its Grayscale Bitcoin Trust into a spot Bitcoin ETF.

Last week the US Court of Appeal ruled that the regulator’s decision was arbitrary, reigniting hope that the decision would soon be overturned. SEC, however, eventually announced a delay in making any decisions on the issue until October, driving cryptocurrencies down. 

BTC/USD 1h Chart

ETH/USD 1h Chart

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Written by:
Myrsini Giannouli

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