Despite recent turmoil in the stock market, cryptocurrencies such as Bitcoin continue to hold strong. In the past, such market volatility would have rattled the crypto world, but now it appears that digital assets are increasingly seen as a safe haven in the face of geopolitical risks.
Over the past 24 hours, the price of Bitcoin has risen by 1% to approximately $34,450. This puts it within touching distance of its recent peak above $35,000, which was reached earlier this week. This represents the highest level since the crypto market endured a brutal bear market in May 2022. In the span of just two weeks, the leading digital asset has surged by around 30%, displaying its characteristic volatility once again after months of stagnation and historically low trading volumes.
Analyst Alex Kuptsikevich from broker FxPro has observed a pattern of higher lows that has gradually pushed the price of Bitcoin closer to the upper range of consolidation since Tuesday. However, he cautions that breaching the upper boundary in the coming weeks will not be an easy task. Despite this, Kuptsikevich believes that Bitcoin remains in a territory of relatively low density and highlights key resistance levels at $38,000 and even $48,000.
One of the main driving forces behind Bitcoin’s recent rally is the anticipation that the Securities and Exchange Commission (SEC) will soon approve the launch of the first spot Bitcoin exchange-traded fund (ETF). This is viewed as a pivotal catalyst that is likely to generate a fresh wave of investor interest in the cryptocurrency market.
As the stock market experiences uncertainty, Bitcoin and other cryptocurrencies prove their resilience and attractiveness to investors. The potential for a new ETF further adds to the positive sentiment surrounding Bitcoin’s future prospects.
Bitcoin’s Sturdy Performance amidst Stock Market Turmoil
Bitcoin has showcased remarkable resilience in the face of recent turmoil in the stock market. While the cryptocurrency market has traditionally been closely linked to other risk-sensitive assets such as stocks, Bitcoin has remained steadfast, even gaining ground amidst declines in the Dow Jones Industrial Average and S&P 500. These stock market declines have been driven by downbeat corporate earnings and concerns over rising interest rates, which are particularly influential for digital assets.
Market expert Kuptsikevich noted, “The crypto market is holding its total capitalization…despite a frightening selloff in equities overnight. Bitcoin and other major altcoins are once again attempting to play the role of a safe haven.” This suggests that Bitcoin and other cryptocurrencies are increasingly being seen as a reliable asset during times of volatility. Previously, Bitcoin has not consistently acted as a safe haven asset like gold, despite being referred to as “digital gold.” However, recent developments indicate a potential shift in this perception. Analysts have pointed out Bitcoin’s growing correlation with gold, especially in light of renewed conflicts in the Middle East. This correlation may pave the way for further gains for digital assets.
In addition to Bitcoin’s strong performance, Ether, the second-largest cryptocurrency, saw a significant 4% surge, reaching $1,850. Other smaller altcoins also experienced positive movement, with Cardano surging 5% and Polygon up by 4%. Notable memecoins, such as Dogecoin and Shiba Inu, displayed even more buoyancy, rallying by 10% and 9% respectively.
Bitcoin’s ability to weather stock market turbulence while gaining ground highlights its resilience and potential as an investment asset. As the cryptocurrency market evolves, Bitcoin’s correlation with gold and its safe haven attributes may continue to shape its trajectory.