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Market Wrap: Bitcoin Trades Well Above $50K, While Ether Outperforms on NFTs, July’s Upgrade

Market Wrap: Bitcoin Trades Well Above $50K, While Ether Outperforms on NFTs, July’s Upgrade

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coindesk | 2021/03/11

Bitcoin (BTC) trading around $51,800.08 as of 21:00 UTC (4 p.m. ET). Climbing 3.48% over the previous 24 hours.

Bitcoin’s 24-hour range: $49,390.18-$51.982.31 (CoinDesk 20)

BTC trades above its 10-hour and 50-hour averages on the hourly chart, a bullish signal for market technicians.

Bitcoin trading on TradingView

Source: TradingView

Bitcoin’s price in recent weeks has retreated from February’s all-time highs, declining alongside U.S. stocks as investors grew increasingly concerned rising U.S. government bond yields might prompt the Federal Reserve to tighten monetary policy, curtailing the easy-money era that has boosted risky assets from stocks to cryptocurrency. 

But on Monday, bitcoin’s price climbed for a fourth straight day, even as 10-year bond yields continued their march toward 1.6%. U.S. stocks slipped.    

“It is interesting to note that Treasury yields and the U.S. Dollar Index are both moving up but bitcoin, unlike previous times, is not moving inversely to them,” Andrew Tu, an executive at quantitative trading firm Efficient Frontier, told CoinDesk.

At the moment there’s little evidence of a surge in trading volume that might reflect a fresh jolt of market intensity. The daily volume reported by eight U.S.-focused exchanges CoinDesk tracks has remained flat, in keeping with the trend of almost two weeks.

Source: CryptoCompare

One bullish sign continues to develop: balances of bitcoin held on exchanges have reached the lowest level since November 2018, according to data from blockchain data site Glassnode. Market analysts have interpreted the lower bitcoin balance on exchanges as a bullish sign, an indication that few traders are planning to sell out of their long positions. That could imply low chances of a major market correction in the near term.

Source: Glassnode

While trading activity is relatively muted, with bitcoin holding above $50,000, some analysts are eyeing the next resistance level.

Others, however, warn that if bond yields and dollar strength continue to rise, the crypto market might turn weak again.

“With the U.S. rates market, we might see some choppy moves with risk-off sentiment spilling over into crypto markets,” Annabelle Huang, partner at crypto market maker Amber Group, told CoinDesk. 

Huang said a near-term supporting level for bitcoin would be in the range of $40,000 to $43,000. She says past visits to those levels have been tempting enough to draw in buyers. 

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