Bitcoin’s price increased more than $31,000 today. This rise was caused by some factors that demonstrate a restored faith in the cryptocurrency market. Long-term holders are obviously in an accumulation phase. To keep that positive momentum going, the Federal Reserve has signaled that interest rate cuts could come as soon as later this year. This latest price action may indicate a change in sentiment, possibly opening the door for even larger advances.
Long-Term Holders Signal Accumulation
Bitcoin long-term holders, which includes anyone holding the crypto asset for over 155 days, are showing accumulation behavior. This behavior matters a lot because bull markets need just the right amount of sell-side pressure from LTHs and new, fresh demand. Like past market cycles, this one has absorbed an equal amount of long-term holder profits. This reflects a positive degree of market engagement and a successful absorption of selling, or profit taking, pressure.
Specifically, a notable short-lived but acute eruption in LTH distribution took place when Bitcoin’s price fell to four-month lows. Even with this dip, some opportunistic investors took the chance to sell off for profit. At the same time, long-term holders continue to hold predominantly and even accumulate more, indicating their confidence in Bitcoin’s long-term prospects.
Technical Analysis Points to Potential Upside
After testing the lower trendline of its prevailing ascending channel pattern, the bitcoin price exploded. This trend points to a possible medium-term bullish outlook, with a resistance wall around $87,830. Looking ahead, the 200-4H EMA, one of the most important technical indicators, is sitting around this level as well. This alignment further strengthens the possibility for a price target in that locality.
The next major correction would probably bring Bitcoin back down to test the lower channel boundary, now acting as support, which is near $82,400. This level served as support from March 16 to March 17. That means it might act as a powerful price floor for any future declines in price.
Federal Reserve's Stance Boosts Market Sentiment
The Federal Reserve just recently indicated that it intends to lower interest rates by two cuts this summer. This announcement has already gone a long way to lifting market sentiment. This dovish pivot soothed investor jitters about continued monetary tightening which had recently pressured risk assets such as Bitcoin. Bitcoin to balloon dramatically. This jump was in step with the market’s bullish reaction to the recent hints of greater monetary policy accommodation.
