Bitcoin Holds Above $66,000 While Altcoins Trade Mixed and Stocks Soar

(Kitco News) – The crypto market was mixed in terms of performance on Tuesday as Bitcoin (BTC) consolidated above $66,000, while some altcoins rose as traders rotated their positions, meaning other tokens fell as they sold off.

“Bitcoin recently bounced off an ascending trendline and is now attempting to break out above a short-term resistance level at around $67,500,” analysts at Secure Digital Markets said. “This morning’s release of flash manufacturing and services PMI data has catalyzed a rise in risk assets as signs of a market slowdown emerge.”

“Additionally, Bitcoin’s 200-day moving average – a critical measure of long-term trends – is nearing an all-time high, challenging its previous high of $49,452 recorded in February 2022,” they added. “Historically, Bitcoin prices have risen when the average has reached new highs; However, it is essential to remember that historical performance is not indicative of future results.

Data provided by TradingView shows that Bitcoin traded in a range between $65,830 and $67,241 on Tuesday, with rises and falls of equal strength following Friday’s halving.

BTC/USD Chart by TradingView

Stocks surged higher as investors digested positive earnings reports from GM and Spotify, with the market now eagerly awaiting the report from Tesla, whose quarterly results are due after the market close.

At the closing bell, the S&P, Dow and Nasdaq finished up 1.20%, 0.69% and 1.59%, respectively. The DXY fell 0.4% on the day and is trading at 105.7 at the time of writing, while gold fell 1.5% in early trading but recovered for a small amount. loss of 0.2% on the session.

Short-term weakness, long-term growth

“Short term, [Bitcoin’s price action following] halving tends to be rather quiet,” said Matt Ballensweig, head of the Go network at BitGo, in a note to Kitco Crypto.

“The delta of newly mined Bitcoin per day after the halving is 450 BTC, barely enough to impact daily liquidity or immediate price action,” he added. “In fact, miners might even need to sell some of their existing BTC inventory to compensate for the reduction in daily revenue, leading to increased selling pressure in the days/weeks following the event.”

“That being said, in the long term, the reduced supply from one day to the next amounts to 164,000 BTC ($12 billion) per year, which combined with the net new demand for Bitcoin from the ETF, can cause prices to rise significantly. longer-term appreciation,” Ballensweig said. “The data supports this since the average return of Bitcoin one month after all historical halvings is only 1.67%, while the average return of Bitcoin one year after these halving events is 3,211 %, highlighting the difference in impact between the short term and the short term. extended periods of time. »

Steven Lubka, head of private clients at Swan Bitcoin, agreed with Ballensweig that “the impact of the halving is more pronounced in the medium to long term.”

“At current prices, that’s about $30 million a day that’s not being sold, which may not seem significant on a day-to-day basis, but adds up significantly over time,” he said. “For example, over a month, that’s $1 billion, and over a year, $12 billion.”

“This reduction in supply issuance creates a mechanical impact that pushes prices up,” Lubka noted. “Moreover, the halving serves as a built-in marketing for Bitcoin, attracting new users and creating a reflexive social layer that further strengthens prices through increased demand. Ultimately, it is the combination of guaranteed supply reduction and social impact that fuels Bitcoin’s long-term uptrend.

The combination of demand for spot Bitcoin ETFs and the reduction in supply of new Bitcoins caused by the halving significantly improves the upside potential of Bitcoin’s price, he added.

“When you have an increase in buying pressure at the same time, you have a decrease in

selling pressure. It’s not one plus one equals two, but one plus one equals four,” Lubka said. “And so I think, given ETFs at the same time that we halved this year, it wouldn’t surprise me at all to see an outsized impact compared to the past.”

“The ETF story is less than 5% over and has not yet been fully realized,” he added. “They haven’t fully deployed their marketing budgets, they haven’t finished all the conversations they’ve had, they haven’t finished adding these ETFs to other portfolios and other products that Fidelity serves and BlackRock. Most financial firms still can’t buy the ETFs, they are subject to non-solicitation clauses, advisors can’t talk about them, and you can’t hold them in an advisory account. This story is not over. What is the next catalyst? These are ETFs.

As the market waits for the next catalyst to put cryptocurrency prices back on an uptrend, MN Trading founder Michaël van de Poppe said any Bitcoin pullback below $60,000 is an “opportunity to ‘massive purchase’.

Altcoin gains double digits

The top 200 altcoins were evenly split between winners and losers on Tuesday, with seven tokens posting double-digit gains.

Daily performance of the cryptocurrency market. Source: Coin360

Hedera (HBAR) soared 40.4% to lead the gainers, followed by a 31.9% increase for Cat in a Dog’s World (MEW) and a 24.2% gain for Akash Network . Stablecoin project Ethena (ENA) led the losers with a 7.7% decline, while Ontology (ONT) fell 7.6% and Jito (JTO) lost 5.8%.

The global market capitalization of cryptocurrencies now stands at $2.45 trillion and Bitcoin’s dominance rate is 53.4%.

Disclaimer: The opinions expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is for informational purposes only. This is not a solicitation to trade any commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no liability for loss and/or damage arising from the use of this publication.

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