Bitcoin price retested the important resistance level at $65,000, driven by ongoing accumulation by whales and sharks and strong technicals.
Bitcoin (BTC) has entered a technical bull market after rising over 21% from its lowest level this month. According to Santiment, this price action has been largely fueled by increased accumulation by whales and sharks.
MicroStrategy, the largest corporate Bitcoin holder, has been at the forefront of these purchases. Earlier this month, the company bought coins worth $458 million, bringing its total holdings to 252,220.
Institutional investors have also been increasing their Bitcoin purchases. Data shows that all funds have seen inflows for five consecutive days, with net inflows this month totaling over $600 million.
These gains have been attributed to falling interest rates in many countries, rising global money supply, and recent stimulus measures by the Chinese government. The government plans to inject $142 billion into the economy. All these factors have contributed to a risk-on sentiment among investors, as evidenced by the rising fear and greed index.
Bitcoin is also reacting to the surging US public debt, which has jumped to over $35.4 trillion, with annual interest payments nearing $1 trillion. Traders believe that Bitcoin and gold are better alternative assets to hedge against a default risk.
Additionally, Bitcoin’s price has held steady due to improving technical indicators. It formed an inverse head and shoulders pattern, avoided a death cross pattern, and the Relative Strength Index has continued to rise, indicating that momentum is building.
However, Bitcoin is not out of the woods yet. A clear bullish breakout will be confirmed once it moves above the upper side of the descending trendline that connects the highest swings since March.
