Bitcoin is clearly back in bullish mode here with eyes on the $90,000 to $92,000 target. This is occurring alongside a rapid depreciation of the US dollar which has had many investors looking to Bitcoin as a hedge against depreciation and inflation. The cryptocurrency has been on a remarkable rebound since hitting a low in April. Positive ETF data and strong outlooks are behind this upward momentum.
Dollar's Dip Drives Bitcoin Interest
The most important factor in Bitcoin’s recent surge is the weakening US dollar. Investors are increasingly viewing Bitcoin as a safe haven asset, a traditional role of gold. As the dollar continues to lose value over time, holding wealth in Bitcoin becomes increasingly appealing. In particular, it rings true to US-based investors who increasingly wish to protect their capital.
Bitcoin and the US dollar have had an inverse correlation for most of their historical relationship. With this inverse correlation, a weakening dollar usually strengthens Bitcoin, while strengthening the dollar weakens Bitcoin. This inverse relationship is the engine creating today’s investment strategy. More investors are starting to view Bitcoin as a hedge against dollar devaluation.
Fears of inflation and economic uncertainty have only made Bitcoin’s attractiveness as a way to preserve the value of dollar-denominated assets all the more enticing. During these periods, investors flock to assets not tied to wallet, bank, or traditional financial systems, which Bitcoin has proven time and again it is not.
Technical Indicators Point to Bullish Trend
Bitcoin’s recent price action is an exciting confirmation of a bullish breakout after weeks of consolidation between strong support at $83,000 and resistance at $86,000. The cryptocurrency has notably cleared its 30-day exponential moving average (EMA), an important technical marker of bullish momentum. This breakout is a sign that the upward trend might be on the cusp of continuing.
As it stands, Bitcoin’s 200-day simple moving average (SMA) is at $88,245. Most notably, the price cleared the psychological barrier of $87,000, showing strong bullish momentum. According to technical analysis, Bitcoin’s next target range lied between $90,000 and $92,000.
BTC is now exhibiting very bullish recovery momentum after bouncing from a low of under $75,000 on April 7. From today’s findings, it looks like this positive trend isn’t stopping. Positive market sentiment and increasing institutional interest are fueling this recovery. You can observe this first-hand with the recent success of Bitcoin spot ETFs.
ETF Inflows and Market Optimism
The total net asset value of Bitcoin spot ETFs is now at $94.51 billion. This spike marks a new institutional adoption trend, characterized by rising institutional adoption of Bitcoin. From April 14 through 17, these thematic ETFs together netted $15.85 million in inflows. This upswing is further proof that investors still believe in Bitcoin’s long-term potential.
Legacy Bitcoin spot ETFs garnered a historical cumulative net inflow of $35.37 billion. This increase just deepens Bitcoin’s position as a canonical investment asset of choice. These ETFs now account for 5.59% of Bitcoin’s total market cap. This change illuminates their increasing influence over the cryptocurrency’s price and broader market movements.
Meanwhile, Arthur Hayes, co-founder of crypto derivatives exchange BitMEX, has added to the bullish fire. He’s predicting that Bitcoin’s price is on the verge of skyrocketing over $100,000. Investor sentiment is increasingly bullish as forecasts are seemingly lining up with strong ETF inflows and bullish technical formations. It’s this powerful twin-engine that’s propelling today’s upward momentum.
