Market Cover: Bitcoin Rallies After Passing $ 50,000 to $ 52,000 Psychological Level

Bitcoin broke above $ 52,000 on Wednesday, with a market capitalization of about $ 1 billion.

Bitcoin is in ‘uncharted territory’, said Hunain Naseer, senior editor at OKEx Insights, after the price rose to a new high of more than $ 52,000, just a day after hitting the key psychological threshold of $ 50,000 reached.

The volatility of the price remains high compared to key macro assets, including the Standard & Poor’s 500 index of equities, gold and bonds.

“We can expect some consolidation between $ 50,000 and $ 52,000, with a possible retest of the $ 49,000 support,” Naseer added.

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One positive signal: a large amount of stable reserves on cryptocurrency exchanges, according to data from CryptoQuant based in South Korea. This can show that traders are moving steel coins into place so that they can buy quickly if the price is right.

“So many stable coins in exchange” compared to bitcoin held in exchange, CryptoQuant CEO Ki Young Ju told CoinDesk, pointing out that the selling pressure is relatively low.

In the derivatives market, bitcoin futures on the Chicago-based CME on Tuesday recorded a record high one-day trading volume and total interest, according to data from the blockchain analysis site Skew. The increased activity may be an indication of the rising demand for bitcoin from institutional investors.

Institutional interest in bitcoin is also reflected in another market indicator called the Coinbase premium, a measure of the price difference between Coinbase Pro’s BTC / USD pair and Binance’s BTC / USDT pair, CryptoQuant’s Ki said. The number turned positive on Wednesday.

‘Coinbase [U.S. dollar] whales are like gatekeepers ”of the bull market, Ki said about investors with great interest.

Ether (ETH), the second-largest market capitalization cryptocurrency, was higher on Wednesday, trading at around $ 1,828.15, up 4.45% in 24 hours from 21:00 UTC (16:00 ET).

On the technical side, ether is in a consolidation phase after losing short-term momentum, according to Katie Stockton, a technical analyst at Fairlead Strategies.

“I see consolidation as healthy in the context of the strong rising trend,” Stockton said. “The 20-day moving average at $ 1,556 is a measure of initial support.”

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Ether’s correlation with bitcoin was around 0.68 this month, after declining to 0.55 in January.

“As long as bitcoin stays above $ 49,000, we can expect a rally in the altcoins, including ether,” Naseer of OKEx said. “But that will only happen if the volatility of bitcoin drops a bit.”

At the same time, institutional interest in ether futures has grown significantly, according to data provided by blockchain analytics firm Glassnode.

“A week after ether futures were launched on CME, daily trading volume reached a total of $ 75.8 million yesterday, nearly doubling Friday’s volume of $ 40 million,” Glassnode wrote in a tweet Wednesday. “Meanwhile, public interest has risen to $ 62 million.”

Trader and analyst Alex Kruger says the launch of CME’s new ether futures contract last week may be one reason why ether’s price underperformed.

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“Ether is a high beta asset for bitcoin, and it’s supposed to move in line,” Kruger said. “Sometimes he starts his own set of technical and / or fundamental drivers and makes price paths or performance differences.”

Digital assets on the CoinDesk 20 are mostly green Wednesday. Notable winners from 21:00 UTC (16:00 ET):