Bitcoin has maintained its position above $77,000, following a significant surge earlier in the week to its highest level since early February, with a current value of $78,433.60. The cryptocurrency is poised for its best monthly performance in a year, with a 13.6% increase in April, according to data from CoinGlass.
This rebound comes after a challenging period, marked by the longest losing streak in crypto markets since 2018, with consecutive monthly declines 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 growth of Tether's USDT, the largest stablecoin, to nearly $150 billion, with an increase of approximately $5 billion over the past two weeks, is a significant driver.
This expansion of stablecoin supply acts as a liquidity indicator in crypto markets, signaling potential capital inflows and a positive outlook for asset prices. Despite ongoing geopolitical tensions and uncertainty surrounding the Iran war, which have kept oil prices elevated, markets appear to be looking beyond these concerns. According to Jasper de Maere, an OTC trader at Wintermute, the equities and crypto markets seem to have become desensitized to intricate headlines about the conflict, potentially indicating fatigue and complacency. De Maere notes that robust corporate earnings and resilient equity markets are offsetting concerns about higher energy costs and geopolitical risks.
The upcoming Fed meeting in April will be a crucial test for the current rally. If institutional demand sustains and ETF inflows continue, the $79,000 level could transition from resistance to support, paving the way for a higher trading range. Conversely, if inflows diminish, bitcoin may revert to the $75,000-$77,000 range.