Do the Crypto Bulls Have the Staying Power? We’ve Been Here Before…

Bitcoin moves back through to $5,000 levels early on. Holding above $4,900 levels through the day will be a major coup for the Bulls.
Bitcoin symbol in blockchain technology and cryptocurrency concept. Abstract background 3d illustration.

Bitcoin surged by 17.3% on Tuesday. Following a 0.7% rise on Monday, Bitcoin ended the day at $4,922.2.

Bullish from the start of the day, Bitcoin rallied from an intraday low $4,187.4 to a mid-morning intraday high $5,106.9.

Steering clear of the day’s major support levels, Bitcoin broke through the day’s major resistance levels and 23.6% FIB of $4,816. It was Bitcoin’s first visit to $5,000 levels since 20th November.

Key in the day was Bitcoin’s break through the all-important $4,500 level that was needed to draw in sidelined investors.

Elsewhere

Across the top 10 cryptos, Bitcoin Cash ABC stole the show on Tuesday, surging by a whopping 45.7%. The breakout led to a near-term bullish trend formation after hitting an intraday high $248.

Litecoin also found strong support, rallying by 28.4% on the day. Trailing the trailblazers, but not too far off, were EOS (19.5%), Cardano’s ADA (18.6%) and Ethereum (16.9%).

While bullish through the day, an early morning jump delivered the killing blow to the bears.

The total crypto market cap jumped from $159bn to a high $176.97bn on Tuesday before easing back.

Perhaps more impressively was the jump in volumes as investors jumped back onto the crypto bandwagon.

The 24-hour trading volumes had already risen to $48.5bn in the early hours of Tuesday. By late morning on Wednesday, volumes hit a day high $89.5bn…

What drove the rally across the majors on the day?

There were no major news events to drive Bitcoin back through to $5,000 levels. A positive end to the 1st quarter and some solid gains for the likes of Litecoin and Binance will have drawn investor attention.

April is a bullish month across the more traditional asset classes. The cryptomarket’s staying power will have impressed some of the doubters. As adoption continues to rise, albeit at a snail’s pace, and the SEC looks set to approve at least one of the Bitcoin ETFs, if not next month, sooner rather than later, there is optimism in the broader market.

It won’t be the first time that we’ve seen the bounce, however. Investors will be mindful of what happened in the last rally and any pullback could accelerate Bitcoin’s return to sub-$4,000 levels.

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This Morning

At the time of writing, Bitcoin was up by 1.6% to $5,001.1. Another bullish start to the day saw Bitcoin rally to a morning high $5,090.1 before easing back.

Coming up short of the first major resistance level at $5,290.2, Bitcoin slid back to a morning low $4,909.0 before moving back into positive territory.

The day’s major support levels were also left untested early on.

Across the top 10, Bitcoin Cash ABC continued to lead the way, up by 6.09% at the time of writing, closely followed by Litecoin, which was up by 5.5%.

For the day ahead

A hold above $4,900 levels through the day would continue to support a run at the first major resistance level at $5,290.2.

Support from the broader market later in the day could deliver a second breakout to $5,300 levels before any pullback.

Barring a broad-based crypto rally, however, we would expect Bitcoin to struggle to break through to $5,100 levels on the day.

Following some choppy moves last year, some profit taking could cap the upside on the day, should the broader market not experience another jump.

Failure to hold above $4,900 could see selling pressure build through the day. A fall through $4,750 levels would bring the first major support level at $4,370.7 into play before any recovery.

Trading volumes will need to be tracked through the day. Larger price swings are to be expected should trading volumes begin to ease back towards sub-$50bn levels.

We could be seeing $6,000 levels by the weekend should Bitcoin avoid a pullback mid-week…

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