Bitcoin (BTC) Price Smashes Past $40,000 First Time in 18 Months, What’s Next?

Bitcoin (BTC) Price Smashes Past $42,000 First Time in 18 Months, What’s Next?

December 4, 2023

Bhushan Akolkar

Senior Journalist

Expertise : Cryptocurrency, Blockchain, Macro Finance

Bhushan is a seasoned crypto writer with over eight years of experience spanning more than 10,000 contributions across multiple platforms like CoinGape, CoinSpeaker, Bitcoinist, Crypto News Flash, and others. Being a Fintech enthusiast, he loves reporting across Crypto, Blockchain, DeFi, Global Macros with a keen understanding in financial markets.   He is committed to continuous learning and stays motivated by sharing the knowledge he acquires. In his free time, Bhushan enjoys reading thriller fiction novels and occasionally explores his culinary skills. Bhushan has a bachelors degree in electronics engineering, however, his interest in finance and economics drives him to crypto and blockchain.

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Crypto Stocks, Nvidia Rise Alongside Bitcoin Ahead Of US CPI

In an unexpected move over the weekend, the price of Bitcoin (BTC) has surged past the eagerly anticipated $42,000 milestone, accompanied by robust trading volumes. As of the latest update, BTC is trading at a 6.83% gain, reaching a price of $42,081 with a market capitalization of $826 billion. The substantial trading volumes have approached the $29 billion mark, reflecting heightened activity in the cryptocurrency market.

FOMO Buying Into Bitcoin

This is the first time that the Bitcoin price has rallied past the $40,000 level since May 2022, or in 18 months. The cryptocurrency market is now closely watching for the impact of both fear of missing out (FOMO) and fear, uncertainty, and doubt (FUD) regarding the anticipated confirmation dates for the ongoing exchange-traded fund (ETF). Analysts speculate that the Bitcoin ETF developments will influence the trajectory toward $50,000.

As inflation shows signs of cooling, investors are growing more certain that the Federal Reserve has concluded its series of interest rate hikes. The attention has shifted to speculation about potential rate cuts in the upcoming year, creating a favorable backdrop for a rally in global markets.

Simultaneously, the digital asset industry is on the lookout for developments related to applications submitted by major players like BlackRock Inc. for the introduction of the first U.S. spot Bitcoin exchange-traded funds (ETFs). Bloomberg Intelligence anticipates that a group of these funds is likely to receive approval from the Securities and Exchange Commission (SEC) by January. The outcome of these applications will have a significant impact on the digital asset market.

“Bitcoin continues to be supported by optimism around SEC approval for an ETF and Fed rate cuts in 2024,” Tony Sycamore, a market analyst at IG Australia Pty, wrote in a note.

Where is the BTC Price Moving Next?

As per the technical chart, the next resistance to watch for Bitcoin would be $42,330. In the latest analysis provided by CrediBULL Crypto, the observation notes that open interest (OI) remains relatively low despite the ongoing upward movement in prices. The analysis highlights that historical instances of a decline in OI led to a maximum $2,000 drop before reaching a baseline, indicating a potential bottom.

As the current trading price stands at 40.5k, the local bullish invalidation level stands at 39.5k. Despite some anticipating a decline to 30k, the analyst expresses skepticism about moves down to 35k and below, considering them unlikely.

Referring to a previous statement, CrediBULL Crypto emphasized the expectation of no major pullbacks once the 40k+ regions are breached, maintaining confidence in this stance. Some market analysts also expect the BTC price to hit $60,000 before the next halving of April 2024.

OI remains relatively low here as price continues to climb.

Even when we did get a flush from these levels of OI the most we saw was a $2,000 drop to the downside before OI hit the "baseline" which marked our bottom.

We're trading at 40.5k.

Local bullish invalidation is at… https://t.co/lyt83ddz58 pic.twitter.com/o4Xz7soIut

— CrediBULL Crypto (@CredibleCrypto) December 4, 2023