Bitcoin recently had its largest increase in weeks, up almost 9% in one day, and surpassed the $70,000 mark for the first time since June. Now, BTC is priced near $72,000. The surge started due to the new government policy announcements and was reinforced when short sellers began covering their open positions. In one day, $2.7 billion in short positions was liquidated. After weeks of frightening market conditions, traders are now asking where the new BTC price can reach.
Key price levels to watch
The $70,000 level has been the limit for months and is now expected to be the support level. Under this level, there is a much deeper level of around $62,600, which remained intact for much of August. The next resistance on the way up is at around $76,000 associated with Bitcoin highs this year. Above that, the next important level is $80,000. The Fear and Greed Index, on the other hand, has also shifted from fear to greed, rising from 46 to 62.
Fundamentals behind the move
The increase is happening in a larger context. A report by Phemex states that the number of businesses owning Bitcoin has reached 186 and that this continued accumulation is eating up the supply available on the market. Additionally, the company explains that new Bitcoins entering the market are produced slowly and do not compensate for the coins being mined, as per the halving routine. Furthermore, TheStreet published the news this month related to the US inflation rate showing signs of weakness, which could lead to disruption in the Fed’s actions and make riskier assets appealing again.
Why the story looks strong for September
This breakout occurred with a strong signal, indeed, not merely an upward drift. In this case, there was significant short covering, allowing for some price slippage, which in some cases can offer better upside potential than strong buying alone. Market sentiment could push prices to $74,000 in mid-September if this momentum persists. Still, after such a significant increase, a pullback could be expected.
At the end of September, a reasonable range would be between $70,000 and $76,000, while breaking above $76,000 may result in reaching the $80,000 mark.