On Tuesday, March 29, the world’s largest cryptocurrency made a move to $48,000, however, faced resistance at its 200-day moving average (DMA). As of press time, Bitcoin is facing a minor pullback and is currently trading at a price of $47,131 with a market cap of $895 billion.
Bitcoin has undergone major sell-offs earlier this year and it was only during the last week’s price rally that BTC was able to write off all losses for 2022. As per data from Coinglass, more than $230 million in short positions we liquidated earlier this week on Monday, March 29.
This happens as the Bitcoin spot volumes have surpassed the Bitcoin futures volumes as BTC made a move to $48,000. This clearly shows that the Bitcoin price recovery was largely spot-market driven.
Crypto Market Participants Remain Bullish
Although Bitcoin is facing resistance at its 200-DMA, some of the crypto market participants continue to stay bullish. Kyle Davies, co-founder and chairman of Singapore-based crypto hedge fund Three Arrows Capital, said:
There are “no more sellers left after several waves of bad news — leverage wipe-out, macro concerns, Ukraine war. So it’s natural for Bitcoin to have a strong bid here.”
Furthermore, the Federal Reserve announced its first rate hike for 200 earlier this month. This was the first time in four years that the Fed announced a rate hike. The U.S. central bank has also said that the Fed is preparing for multiple rate hikes ahead this year. This has made the market jittery and volatile.
But Jeff Dorman, chief investment officer at crypto asset management firm Arca believes that as per historical trends, risk assets usually tend to move higher in the aftermath of the rate hike. He added:
“The entire risk-assets selloff was way overdone and made no sense to begin with. Markets generally go higher during rate hikes, and it’s only at the end of a rate-hike cycle when markets typically go the other way.”
Bit Market Players Accumulate Bitcoin
Furthermore, data from CoinShares also shows that institutional capital inflows in crypto funds stood at a strong $193 million last week. Bitcoin alone dominated 50% of the total inflows.
On-chain data provider Santiment also reported: “Bitcoin’s whales have been active today. The 3,266 $100k+ transactions between 2pm and 6pm UTC were the most in a 4-hour interval since March 1st. Market prices peaked at just above $48.0k 8 hours ago, and they’ve now come down just slightly to $47.3k”.