Key Points
- Bitcoin (BTC) has started a new week, month and quarter of 2024 with several new records.
- A battle between buyers and sellers is keeping old all-time highs from 2021 firmly on the table.
Bitcoin has launched into a new week, month, and quarter in 2024, setting several new records. The cryptocurrency's price action made history on March 31, marking the end of the first quarter of 2024 with the highest close ever recorded.
Resistance and Price Discovery
Despite old resistance not giving up without a fight, a tug-of-war between buyers and sellers is keeping the old all-time highs of 2021 within reach. For Bitcoin to break new ground and achieve price discovery, it needs a boost to $74,000 to eliminate the majority of latecomer sell-side liquidity.
As the second quarter gets underway, the stage is set for possibly volatile moves. Adding to the mix is the classic macroeconomic data component, with nonfarm payrolls due from the United States at the end of the week. This will be preceded by fresh commentary from Jerome Powell, chair of the Federal Reserve.
Bitcoin and the Market
Last week, Bitcoin seemed to react positively to Powell, who kept the possibility of interest rate cuts in 2024 in focus. As Bitcoin continues to hold its high position, seasoned hodlers are increasingly taking profit, countering the influx of institutional capital from spot exchange-traded funds (ETFs).
The price of Bitcoin delivered for bulls at the end of Q1, with the March 31 weekly, monthly, and quarterly close becoming its highest in history at just below $70,300. A predictable retracement followed; however, local lows of $68,900 appeared only hours later.
Bitcoin's old all-time high from 2021, $69,000, continues to act as a market focus. The first Wall Street open is significant, marking the return of ETF flows.
Macroeconomics and Bitcoin
The upcoming U.S. macro week features a fresh appearance from Fed Chair Powell, who will deliver prepared remarks on April 3. Risk assets continue to stay optimistic around long-term economic policy, with some form of interest rate cuts almost certain as 2024 progresses.
This week’s data centers on nonfarm payrolls, a release that recently contributed to Bitcoin price volatility, due on April 5. Weak job numbers would boost the odds of an earlier rate cut and thus fuel risk-asset strength.
Bitcoin Holders and Profit
As Bitcoin sets new records on the charts, long-term holders are wasting little time in taking profit. On-chain data shows that Bitcoin’s “diamond hands” are no longer on the sidelines.
Last month, as Bitcoin hit all-time highs of $73,700, a spike in profit-taking occurred, peaking at around $2.6 billion per day. The situation has since changed, with overall profit-taking significantly declining, but long-term holders still represent a significant chunk of realized profits.
Bitcoin's Future
There is a remarkable similarity between the current Bitcoin price action and its previous bull market in 2021. This challenges the idea that institutional interest has delivered a new Bitcoin price paradigm this year.
Crypto market sentiment is increasingly anticipating a shot at price discovery across markets. The latest readings from the Crypto Fear and Greed Index reveal the return of “extreme greed” as the characterizing mood among Bitcoin and altcoin market participants.
