Bitcoin has maintained its position above $77,000, following a notable surge to its highest level since early February, with the cryptocurrency experiencing a 13.6% increase in April, poised for its best monthly performance in a year, according to CoinGlass data. This rebound occurs after a challenging period, with crypto markets previously logging their longest losing streak since 2018, marked by consecutive monthly declines from October to February. The improvement in the broader macroeconomic landscape, with U.S. equities recovering and the S&P 500 and Nasdaq reaching record highs, has contributed to this turnaround.
Additionally, a crypto-specific factor is at play, with the supply of Tether's USDT, the largest stablecoin, expanding to nearly $150 billion, adding approximately $5 billion over the past two weeks after a period of stagnation. 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 uncertainties, including the Iran war, continue to affect oil prices. According to Jasper de Maere, an OTC trader at Wintermute, markets seem to be overlooking these geopolitical risks for now, with strong corporate earnings and resilient equity markets offsetting concerns about higher energy costs and geopolitical risks. The upcoming Fed meeting will be a crucial test for the current rally, with the potential for institutional demand to drive a more sustainable shift in bitcoin's price. If sustained institutional demand supports the move, bitcoin could break through the $79,000 level, potentially turning it from resistance into support and opening the door for a higher trading range.