Bitcoin rally halted as bears fight back

Most major cryptocurrencies have been bullish for the past few weeks. Bitcoin has crossed major resistance levels, reaching its highest level since November 2021. Bitcoin’s bullish run has renewed interest in crypto markets, boosting other cryptocurrencies as well.

Bitcoin price surged Wednesday, breaking through the $60,000 level barrier for the first time since November 2021 and touching $63,500. However, bitcoin price deflated on Thursday, dropping below $62,000 as bears fought back. If BTC price declines, support can be found at $50,600, while further resistance may be encountered near Bitcoin’s all-time high of $69,100. 

Ethereum price gained strength in early trading on Thursday, testing the $3,500 level resistance before paring the day’s gains. If Ethereum's price declines, it may encounter support near $2,700, while if it increases, resistance may be encountered near $3,500.

Bitcoin is gaining strength as the Bitcoin halving event is approaching. Every halving event cuts the rate at which new bitcoins are released into circulation in half, increasing the scarcity value of Bitcoin. The halving is scheduled approximately every four years, and the next Bitcoin halving event is expected on April 17th raising the value of the cryptocurrency.

The approval of Bitcoin spot exchange-traded funds (ETFs) by the Securities and Exchange Commission (SEC) has caused cryptocurrency prices to surge over the past few months. The SEC has approved 11 applications boosting Bitcoin price. Spot Bitcoin ETF demand has been on the rise this week, boosting the cryptocurrency as well.

Cryptocurrency prices are affected by central banks’ interest rates. High-interest rates are putting pressure on risk assets, while the promise of rate cuts boosts crypto markets. The Fed kept interest rates unchanged at its latest meeting, within a target range of 5.25% to 5.50%. The Fed, however, has indicated that it is preparing to pivot to a less restrictive monetary policy, providing support for crypto markets. 

Markets are under pressure by increased risk-aversion sentiment caused by rising geopolitical tensions. Concerns that the Geopolitical crisis in the Gaza area may spread to neighboring countries drive risk sentiment down putting pressure on risk assets. 

BTC/USD 1h Chart

ETH/USD 1h Chart

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Written by:
Myrsini Giannouli

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