- At $25,270, Bitcoin reached its highest price in the past eight months.
- Rising dollar value and declining inflation are behind the recent price surge.
- Institutional funds have poured into the Bitcoin market, most of which were from the Circle-issued stablecoin, USDC.
Bitcoin established a yearly-high price last Thursday when it rose to $25,270. The latest rally reflects a surge of 18.25% from the local low of $21,376 set after an initial rally in January 2023.
At $25,270, Bitcoin reached its highest price in the past eight months. In a market rally that took many by surprise, Bitcoin added $1,820 in a single day, making it the biggest green day since September 9, 2022, when Bitcoin gained $2,047.
According to analysts, rising dollar value and declining inflation are behind the recent price surge. On the contrary, on-chain data suggests that the rally can be the aftermath of significant inflow from unidentified sources tracked back to February 10, 2023. Since then, nearly $1.6 billion in institutional funds have poured into the Bitcoin market, most of which were from the Circle-issued stablecoin, USDC.
From a technical perspective, the Bitcoin surge comes a few days after Bitcoin hits the weekly death cross. This occurs when a short-term moving average (MA), usually the 50-day MA crosses below its long-term moving average, usually the 200-day MA. Although the pattern appears bearish, it has been followed by short-term above average returns in recent years.
BTC/USD Chart Source: TradingView
Bitcoin made its way upward after consolidating for almost two weeks. It broke through the recently established resistance at $24,258, having rallied to this point in January 2023.
According to William Noble, director of research at Emerging Assets Group and former analyst at Goldman Sachs (NYSE:GS) and Morgan Stanley (NYSE:MS), Bitcoin may head towards the $56,000 region.
The analyst who correctly predicted Bitcoin’s surge from $20,000 to $40,000 in late 2020 said that the flagship cryptocurrency may move from consolidation to another parabolic move back to the predicted price level.
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