Bitcoin Nears All-Time High As US House Passes $1.9T COVID-19 Relief

Bitcoin Signal

Bitcoin Nears All-Time High As US House Passes $1.9T COVID-19 Relief

  • Bitcoin (BTC) trading around $56,248.28 as of 21:00 UTC (4 p.m. ET). Climbing 3.54% over the previous 24 hours.
  • Bitcoin’s 24-hour range: $53,101.24-$57,336.75 (CoinDesk 20)
  • BTC trades above its 10-hour and 50-hour averages on the hourly chart, a bullish signal for market technicians.

Bitcoin gained for a sixth straight day, extending its longest winning streak of the year and approaching the record high price reached last month.

 

The largest cryptocurrency was changing hands above $56,000, up about 3% on the day, and within range of a quick run to the all-time high of $58,332.

 

The day’s gains came amid fresh evidence of two big bullish market drivers over the past year: Bitcoin’s increasing use as a hedge against inflation in the face of trillions of dollars of economic stimulus, and its increasing adoption by big institutional buyers.

 

The U.S. House of Representatives on Wednesday passed a $1.9 trillion coronavirus relief bill, already passed by the Senate, that has been a priority of President Joe Biden’s early days in office. Some economists say the extra money could quickly reheat the economy, spurring a fast rebound in consumer demand and employment that might rapidly lead to price increases.

Crypto analysts noted that the average “funding rates” on the bitcoin perpetuals – a fee traders pay for leverage within derivatives contracts – has started to tick back up  in an indication that markets are turning  more bullish, the Norwegian firm Arcane Research wrote Tuesday in a weekly report.

 

But that is still far from the unsustainable level the market saw in late February, which led to a correction due to liquidations of over-leveraged traders.

 

Trading volume on the spot market, meanwhile, was flat on Wednesday, showing the market has yet to return to the euphoric frenzy witnessed earlier in the year.

“If we think about the volume as energy, and if the buyers only display low energy, then how can they keep advancing the price?” Chris Thomas, head of digital asset at Swissquote Bank, said. “We really need another few [large buy orders] to move us all forward with more energy.”

 

-Muyao Shen, Coin Desk