Bitcoin Momentum Traders Receive Long-Awaited Signal to Buy

The price of Bitcoin (BTC) has surged past $78,000, boosting the overall cryptocurrency market. This upward movement occurred as risk appetite improved following the extension of the ceasefire with Iran by U.S. President Donald Trump, also leading to gains in stock index futures. After weeks of volatile trading between $65,000 and $75,000 in March and early April, Bitcoin's ascent has given momentum traders the green light they were waiting for. Momentum traders typically buy when an upward trend is confirmed, and Bitcoin's breakout could attract more buyers, thereby increasing momentum. As stated by the first law of motion, an object in motion remains in motion unless acted upon by an external force. Analysts at Marex noted, 'The market was capped in the $65 to $75 range for months. Breaking out of this range is significant because it alters behavior. Sellers who were previously comfortable selling rallies above $74 must now reassess. Momentum buyers who were waiting for confirmation finally have something to rely on.' On-chain indicators also suggest the same trend. For instance, according to CryptoQuant, the number of coins held in wallets linked to centralized exchanges has dropped to a fresh multi-year low of 2.67 million BTC, indicating continued investor accumulation that could lead to a supply shock. 'Bitcoin supply on exchanges continues to decrease, with fewer coins available for sale, more BTC being transferred to long-term holders, and liquidity tightening. Bitcoin is becoming increasingly scarce – a decrease in supply means an increase in volatility,' Delta Exchange stated. However, QCP Capital is advising caution due to the persistent relative richness of Bitcoin put options on Deribit. It also noted that crypto trends appear to be linked to oil prices and interest rate outlooks. 'The path forward remains tied to oil and policy. A decrease in crude oil prices or clearer Fed signaling would support risk. Without this, markets are likely to remain in a holding pattern, pricing uncertainty rather than resolution,' the Singapore-based firm said in a market update. In traditional markets, WTI crude futures are trading around $90, having rebounded from a low of $78 on Friday. Meanwhile, DeFi security risks persist due to the proliferation of hacks. Earlier today, the Sui-based Volo protocol was drained of over $3 million, just days after the KelpDAO event caused collateral damage across the sector. For analysis of today's activity in altcoins and derivatives, see Crypto Markets Today. For a comprehensive list of events this week, see CoinDesk's 'Crypto Week Ahead.' The chart shows Bitcoin's daily price movements, with lines indicating the 100-day and 200-day average prices. BTC's price has established a firm foothold above the 100-day average, which is pivotal because the 100-day average capped the bounce in January, leading to a deeper crash to nearly $60,000. Now that the price has pierced through, it typically signals a strengthening of bullish momentum, with the focus shifting to the 200-day average, currently positioned at $85,900.