The recent surge in cryptocurrency prices has been attributed to several driving forces, including increased expectations for the approval of a spot Bitcoin ETF, Shanghai’s successful Ethereum network upgrade, and the upcoming Bitcoin halving event, which is less than 180 days away.
US Markets and Bitcoin ETFs
Discussion of Bitcoin ETFs is steadily increasing as attention turns to the US market. According to Bloomberg’s ETF analysis, there is an estimated 90% chance that the U.S. Securities and Exchange Commission will approve a spot BTC ETF by January 10, the final statutory deadline for ruling on some applications. If the SEC approves them, these ETFs could attract additional institutional capital, ultimately driving up the prices of other cryptocurrencies along with Bitcoin.
Emerging Prominent Bitcoin Supporters
Moreover, prominent Bitcoin backers are showing their faith in the cryptocurrency by expanding their holdings. Glassnode’s on-chain data shows a reversal in the trend, with long-term investors continuing to increase their holdings due to optimism about Bitcoin’s upside potential. This trend reversal, observed in every market cycle, involves holders clearly accumulating until a local price high appears, prompting holders to sell in large quantities to realize profits.
Whale Accumulation and Market Peak
In particular, large price increases have typically been caused by the accumulation of Bitcoin “whales,” or entities holding at least 1,000 BTC. As shown in the chart below, based on Glassnode’s research published on November 27, Bitcoin’s cumulative trend score is currently 1, indicating that the whale population that makes up a major portion of the network is generally getting larger. This continued accumulation suggests that the cryptocurrency market in general, and flagship coin markets in particular, have not yet peaked.
Historical trends and bull cycles
Looking at historical trends, Bitcoin’s price movements often exhibit cyclical patterns. Scholars have pointed out similarities between past and current price trends, hinting at the possibility of a bull cycle similar to those witnessed in 2013 and 2017. Previous Bitcoin bull markets have typically followed a four-year cycle triggered by events such as the supply reward halving. The rate at which miners can generate and earn new Bitcoins. The next halving event is scheduled for spring 2024, but bull markets typically begin months in advance and last until the Bitcoin price reaches new records.
Market Sentiment Rising: Fear and Greed Index
Moreover, market sentiment continues to rise as the Crypto Fear and Greed Index hit a notable score of 73, indicating rampant “greed” in the market. The index has consistently remained above 50 for most of 2023, indicating the positive sentiment market participants have toward the broader cryptocurrency market. This pattern in market sentiment can signal an impending bull market, historically preceded by price increases. Notably, the index last reached this greedy level in November 2021, when Bitcoin reached an all-time high of $69,000.
Technical indicators reflecting a bullish mood
Technical indicators are also consistent with the bullish sentiment of traders. This is because the overall cryptocurrency market capitalization surpassed the 50-week exponential moving average (EMA) of $1.1 trillion on October 23. Buyers could potentially set their April 2022 target as high as $2.168 trillion. — An average gain of 33% is expected across the market. If buyers establish stability beyond the $1.75 trillion threshold with favorable trading volumes, the upward trend could continue for another three months into 2024.
conclusion
In conclusion, the data suggests that a cryptocurrency bull market is poised to begin in 2023 and continue throughout 2024. Heightened hopes for the approval of a spot Bitcoin ETF, the successful Shanghai upgrade of the Ethereum network, and the upcoming BTC halving event are driving prices overall. higher. Market sentiment is rising as major Bitcoin stakeholders show their confidence in BTC by increasing their holdings. Technical indicators also reflect the bullish sentiments of traders as the overall cryptocurrency market cap has moved above key resistance levels. We look forward to continued growth in this exciting space as we enter the next year with optimism!