Bitcoin prices rallied today, climbing to their loftiest value in more than a month as the digital currency appreciated alongside stocks.
The highly visible cryptocurrency, the largest of its kind in terms of total market value, reached roughly $23,685 today on TradingView.
At this point, it was up close to 10% over the last 24 hours, additional TradingView figures reveal. Further, it had risen approximately 35% from its recent low of $17,592.78, which it fell to on June 18.
After reaching its local zenith, the digital asset pulled back somewhat, trading closer to $23,400 at the time of this writing.
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
When explaining these latest gains, several analysts pointed to a broader rally in stocks, as well as the steadily improving mindset of investors.
Armando Aguilar, an independent cryptocurrency analyst, commented on the situation.
“U.S. equities closed another day with big gains as more corporates reported earnings and beat forecasts. This has appeased investors who are worried about inflation and higher production costs that can hurt the bottom line,” he stated.
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“Equities in Asia and Europe also rallied and provided bullish sentiment for investors who might have some appetite for risk-on assets,” Aguilar noted.
“The S&P gained 2.8% on Tuesday and tech-heavy NASDAQ saw a 3.1% gain,” he said, noting that today was “the best single day trading for the S&P 500 since June 9 and best day for NASDAQ since June 24.”
“Correlation to equities has remained high and positive equity market momentum has definitely had an impact on digital assets,” said Aguilar.
Michael Conn, who is the chairman, CEO and co-chief investment officer at Zilliqa Capital, also weighed in, claiming that some investors are flocking to “risk assets, such as Bitcoin and other digital assets,” as they grow more optimistic at a time when the dollar is appreciating and gas prices are falling.
“This along with a ‘baked in’ expectation that the Fed will continue to raise rates to combat inflation is helping to improve investor sentiment,” he stated.
Budd White, cofounder and chief product officer of Tacen, also chimed in, speaking to the recent turmoil that digital currency markets experienced, and how this impacted the value of the world’s most prominent digital currency.
“I think it’s pretty clear that with the massive liquidations that have happened since the collapse of the Terra ecosystem, we entered a situation in which Bitcoin was very, very oversold. There were forced sellers and then some,” he stated.
“And so I think Bitcoin’s price fell far below what would have been considered fair value – even for a macro environment as difficult as the one we are in right now,” said White.
“I suspect, therefore, we have hit a bottom for this bear cycle,” he stated.
“That’s not to say that Bitcoin can’t go lower – perhaps because of some black swan event – but the major liquidations have happened. Those who were prone to selling have already sold.”
“This helps explain why we have seen such major strength for Bitcoin, and I suspect that if we surpass $24,000, then the next level of resistance could be as high as $28,000,” White predicted.
He went on to elaborate on how market conditions for the digital currency have grown stronger lately.
“Now that the speculators have sold out of the market, there is the additional utility value to Bitcoin that has been generated by a net increase in the number of new active wallets globally,” the analyst claimed.
“And so it stands to reason that Bitcoin’s recent strength also stems from an increase in longer-term investors getting more and more exposure recently.”
“This isn’t to say that we are somehow in a bull market again. That’s not the case, I don’t think, and it’s possible that we will be ranging for months and months,” he noted.
“But we certainly are in an accumulation zone for investors,” said White.
“If anything, if we step back and think about what is happening, the recent strength shown by Bitcoin is indicative of just how antifragile this asset really is.”
“It’s been through hell and back over the last few months, and just look at it now. Remarkable!”
Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether, EOS and sol.