Bitcoin has experienced significant volatility in the past 24 hours, surging to a peak of $70,000 before adjusting to its current level of $66,000. The dominance of Bitcoin [BTC] is on the rise as the leading cryptocurrency kicked off the week with strong momentum, aiming for the $70,000 mark.
This bullish performance is fueled by the hype surrounding the Bitcoin 2024 conference and the political excitement over the weekend. The Bitcoin 2024 conference has significantly impacted demand, particularly boosting Bitcoin’s dominance.
This metric has been trending upward since mid-July, peaking at 56.76%, just shy of a new three-year high. Bitcoin’s dominance peaked at 57.03% in April 2024, with the last similar high occurring in April 2021.
Will the upcoming announcement from the FED support Bitcoin’s dominance?
An important announcement from the Federal Reserve is just days away, another factor that could push Bitcoin’s dominance to new heights in 2024. The FED is set to release its next interest rate decision on July 31.
At the time of reporting, market sentiment shows that 96% of analysts expect interest rates to remain unchanged in August. Risk assets like Bitcoin are likely to see a surge in demand if the FED announces a rate cut. However, if interest rates remain steady, the FED’s announcement may have little impact on asset prices.
Market sentiment strongly supports a 25 basis point rate cut in September.
Increased Market Confidence?
This price level is significant because BTC has faced resistance and increased selling pressure in this range since March. Technically, a price surge above $70,000 would also push BTC into overbought territory, according to the RSI. The MACD indicates that bullish momentum is slowing at the time of reporting.
These observations, along with the upcoming resistance zone, suggest the possibility of a pullback driven by short-term profit-taking.
However, the long-term outlook remains optimistic, particularly following the Bitcoin conference. The excitement surrounding this event has bolstered confidence in other markets.
For instance, Japan’s Metaplanet is reported to have purchased Bitcoin worth over 1 billion yen.
Shares of Metaplanet have surged more than 1,300% this year, with a significant portion of the increase occurring in July when the company intensified its Bitcoin purchases. As of the time of reporting, the company holds 246 BTC.
While this underscores a degree of market confidence, Bitcoin’s ability to break through the current resistance zone depends on the level of sustained demand above these thresholds.
The ratio of net inflows from large Bitcoin holders compared to net inflows on exchanges indicates that whales may not have moved significant amounts of their holdings yet.
We will continue to monitor this indicator to assess potential cash flows that could impact Bitcoin’s dominance and price in the coming days.
