Finally, some (somewhat) good news for crypto fans. Bitcoin just posted the highest daily jump in the past few months, recording a 7.6% boost early on Monday. It raced to a price point of $32.3K before dropping down to the mid $31,000 range. Not exactly the price hike everyone’s expecting, but it’s still a bounce back from 9 straight weekly losses and bad performance overall.
The jump comes after S&P 500’s 6.6% rise last week which was its best performance since November 2021. It also comes after news that the Federal Reserve might pause the tight policies in September as US inflation rose only 0.2% in April, which is the smallest gain since November 2020. A lot will depend on the Fed’s September meeting, but until then, experts are optimistic about Bitcoin’s price.
Surprisingly Bullish Week
Bitcoin’s price has been surprisingly bullish since May 27. It finally broke free of the critical $28,600 level and rose over $31K. It went over $32,000 for a short time, registering an 11% rally in the past 4 days. The weekly close was highest in the past 20 days, with bulls scoring a powerful run. However, any upside potential may be limited by a few macroeconomy factors.
Oil prices are continuing to surge as global food shortage fears mount for the winter. Commodities prices are rising all over the world due to the ongoing war in Ukraine. Experts have pinpointed the possible global food shortage as the key factor that can drive Bitcoin’s price potential in the future.
The flow of goods was disrupted during the COVID-19 pandemic, and it will be years before things get back to normal. With further disruptions to the flow of goods, especially wheat from Ukraine, global food shortages are almost a certainty for the coming winter. Of course, there’s always hope that things can soon change or that the shortages won’t be that bad. But, when it comes to Bitcoin, the price of commodities and a global economic crisis will certainly affect its price.
Technical Levels May Limit Bitcoin’s Recovery
Another concerning factor that could limit Bitcoin’s recovery are the technical levels. The 2022 volume profile is very thin, with bulls seeing strong opposition at the $37,000 level. It means that Bitcoin is not soon expected to go past that point, so reaching any higher prices might be limited. At least for now.
If bulls want to send a message, the price point should rise to a daily close of at least $44,000. That seems like a dream now, but it was a reality last year. There are plenty of moving factors that affect Bitcoin’s price, and at the moment, there’s optimism the latest surge will continue.
The key for Bitcoin is to retain the current levels which will put it in a great position to surge. Bulls will need to work hard to keep it over $30,000, but the last few days have been pretty solid, and that’s a positive sign indeed.