Bitcoin has maintained its position above $77,000, following a significant surge earlier in the week to its highest level since February. This upward trend puts the cryptocurrency on track for a 13.6% increase in April, its best monthly performance in a year, according to data from CoinGlass.
The rebound follows a prolonged period of decline, with crypto markets experiencing their longest losing streak since 2018, marked by consecutive monthly drops from October to February. The improvement in the broader macroeconomic landscape, including a strong recovery in US equities with the S&P 500 and Nasdaq reaching record highs, has contributed to this turnaround. Additionally, the supply of Tether's USDT, the largest stablecoin, has grown to nearly $150 billion, with an increase of approximately $5 billion over the past two weeks, following months of stagnation.
This growth in stablecoins, which serve as liquidity in crypto markets, is often seen as an indicator of capital flowing into the crypto market, signaling a positive outlook for asset prices. However, geopolitical tensions in the Middle East and uncertainty surrounding the Iran conflict continue to affect oil prices. Despite these concerns, markets appear to be looking beyond them, with one OTC trader noting that strong corporate earnings and resilient equity markets are offsetting worries about higher energy costs and geopolitical risks.
The upcoming Fed meeting in April will be a crucial test for the current rally, with the potential to determine whether it will hold or fade.