- Bitcoin price action is turning bullish.
- Bitcoin attracts institutions because of its annual gains.
Bitcoin [BTC] has closed above the Bull Market Support band, a critical level on the higher timeframe, after three consecutive weeks of staying below it.
This rally signals potential for BTC’s price to move higher. Despite brief deviations, price action now suggests a bullish trend, with the current level around $67k acting as a key liquidity zone.
Bitcoin breaking through the liquidity zone on strong volume and staying above it makes traders and investors feel confident going long, while others may be adding to their positions.
Source: TradingView
Bitcoin’s allure is unstoppable
Institutional interest in Bitcoin continues to grow, strengthening its upward momentum. Semler Scientific recently bought 83 additional Bitcoin worth $5 million, bringing their total holdings to 1,012 BTC.
This acquisition positions them as the fourth largest Bitcoin holding company in the US, excluding miners.
Historically, BTC has shown resilience with only three years of negative percentage change since inception, while the other 12 years have been positive.
Source: CryptoQuant
Semler’s commitment to buy more BTC, backed by a $150M fundraising effort, reflects the increasing institutional adoption of Bitcoin, which is driving the market higher.
Despite challenges, Bitcoin consistently demonstrates its potential to reach new heights. With this year already showing positive growth, expectations are for a strong finish, reinforcing the bullish sentiment.
BTC and S&P 500 divergence
Bitcoin price movements often mirror the US stock market, particularly the S&P 500. When the S&P 500 rises, BTC tends to follow, and vice versa.
In August, when the market fell 6% due to recession fears, the Bitcoin price also saw a sharp 30% drop.
But as the market has since recovered, trading near all-time highs, BTC remains 20% below July levels and 30% below March 2024 levels.
Source: Bloomberg
This divergence provides a compelling opportunity to buy BTC with the expectation that it will catch up with the stock market rally.
Read Bitcoins [BTC] Price prediction 2024-25
Stablecoin supply increases
Finally, the increasing supply of stablecoins such as USDT and USDC is also supporting a higher BTC price. Over the past three months, their market value has grown by 3%, indicating increasing demand.
With BTC supply growth slowing after the halving, this rising demand suggests that the price is likely to continue to rise higher.
Source: CryptoQuant