Bitcoin has maintained its position above $77,000, following a notable surge to its highest level since early February. With a 13.6% increase in April, the cryptocurrency is poised for its best monthly performance in a year, as per CoinGlass data. This rebound comes after a prolonged period of decline, with crypto markets experiencing their longest losing streak since 2018. The improvement in the broader macroeconomic landscape, including a strong recovery in US equities, has contributed to the turnaround.
Additionally, the supply of Tether's USDT, the largest stablecoin, has increased by approximately $5 billion over the past two weeks, reaching nearly $150 billion. This growth in stablecoins, which act as liquidity in crypto markets, is often seen as an indicator of capital flowing into the crypto market, potentially driving up asset prices. However, geopolitical tensions in the Middle East and uncertainty surrounding the Iran war continue to impact oil prices. Markets seem to be looking past these concerns for now, with strong corporate earnings and resilient equity markets offsetting concerns about higher energy costs and geopolitical risks, according to Jasper de Maere, an OTC trader at Wintermute.
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. If institutional demand continues to drive the move, a breakout above the $79,000 level could mark a more durable shift, while a move driven mainly by short covering may fade once momentum cools.