On Friday, Bitcoin maintained its position above $77,000, following a period of consolidation after reaching its highest level since early February. According to CoinGlass data, the cryptocurrency has seen a 13.6% increase in April, positioning it for its strongest monthly performance in a year. This rebound follows a challenging period for crypto markets, which experienced their longest losing streak since 2018, with consecutive monthly declines from October to February. The improved macroeconomic backdrop, including a strong recovery in US equities with the S&P 500 and Nasdaq reaching record highs, has contributed to the turnaround.
Additionally, the supply of Tether's USDT, the largest stablecoin, has surged to nearly $150 billion, adding approximately $5 billion over the past two weeks. This growth in stablecoins, which act as liquidity in crypto markets, is often seen as an indicator of capital flowing into the crypto market, signaling a positive trend for asset prices. However, geopolitical tensions in the Middle East and uncertainty surrounding the Iran war continue to affect oil prices. According to Jasper de Maere, an OTC trader at Wintermute, markets seem to be looking beyond these concerns, with strong corporate earnings and resilient equity markets offsetting concerns 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.