BTC Recovery Gathers Pace

Bitcoin bulls will certainly be more encouraged by price action over the last 24 hours. Following heavy losses on Monday which saw BTC trading down to its lowest level since February, the leading crypto asset is bouncing back mid-week. BTC is now up around 16% off the August lows and, crucially, is trading back above the 57,215 level. The selling on Monday came amidst a global stock rout as US economic fears caused panic among investors, fuelling a dumping of assets across the board as traders fled back into the Yen, buoyed by tighter BOJ policy.

Institutional Demand Spike

Industry data shows that ETF volumes surged during the correction lower with institutional investors buying heavily into the pull-back. With the prospect of aggressive Fed easing ahead and a potential Trump win in the US elections, there are plenty of reasons to be bullish BTC longer-term. 

Near-Term Risks

However, near-term further weakness could still materialise if we see any fresh shifts lower in the global risk landscape. Hawkish comments from Fed’s Goolsbee on Monday caught traders offside and raised fears that the Fed might not push ahead with expected rate cuts. However, these comments appear to be limited to a minority in the Fed and expectations for a September remain entrenched. If the Fed pushes ahead with easing and signals more to come, this should help bolster risk flows, driving BTC higher.

Technical Views

BTC

The rally in BTC off the 50k mark has seen the market trading back above 53,525, now testing above 57,215 also. This is a key pivot for the market and back above here, focus is on a continued recovery with 60,695 the next hurdle for bulls ahead of the bear channel highs next.