Bitcoin (BTC), which has soared past $65,000, is on track to have its best month in the last decade. This unusual price increase could be attributable to a few key factors.
Bitcoins impressive September gains: Why?
BTC has always had a bad month in September when it comes to price. The apex crypto is on course to have its best month in September for at least 10 years, thanks to several macroeconomic changes.
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In response to slowed inflation and higher unemployment, the US Federal Reserve began its first interest rate reduction cycle in 4 years on September 18. Rates were cut by 50 basis points.
BTC has gained over 10% in value since the rate reduction. The chart from CoinGlass shows that Bitcoin has experienced an average monthly price drop of 3.45% over the past 10 years.
In response to the Fed’s announcement, both the European Central Bank and People’s Bank of China lowered their borrowing rates to boost their respective economies. BTC prices rose to their previous heights.
Bitcoin’s halving could be another factor affecting the price of digital assets. Bitcoin’s halving took place in April of this year, when block confirmation rewards were reduced from 6,25 BTC down to 3,125 BTC.
The scarcity of supply that results from a halving is reflected in past data. BTC prices, for instance, rose by a whopping 45% in May 2020. rose from roughly $8,900 before the halving to more than $64,000 by April 2021 – an 8x price surge in less than a year.
The US-based spot Bitcoin ETFs continue to see a rise in interest, both from institutional and retail investors. On September 26 they saw 365.57 millions in net daily inflows, the highest since July. The cumulative inflows for Bitcoin ETFs since their launch now total $18.31billion.
The BTC Wave Can Be Riding With Cautious Optimism
BTC may have escaped its September slump but it is still important to note that BTC needs to continue to improve. important Price levels prior to hitting the new All-Time High (ATH).
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Bitcoin’s relative Strength Index (RSI), as previously reported, is a measure of the relative strength of Bitcoin. fell Below 80 on the chart monthly, the bullish cryptocurrency momentum may fade following an enthusiastic purchasing spree.
A recent study has also shown that the number of people who use the internet to access information is increasing. report Bitfinex, a crypto-exchange noted that Bitcoin must overcome the strong resistance of $65,200 in order to maintain its upward momentum. BTC has remained steady at $65,674, an increase of 2% over the past 24 hours.
Images from Unsplash and charts from CoinGlass.com, Tradingview.com
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Source: www.newsbtc.com
