Record-Breaking Rally
Bitcoin (BTC) has continued its upward trajectory, surging by 16% from November 11 to November 13, surpassing the $93,000 mark for the first time. Despite this record high, some traders believe that the bullish momentum could weaken as sellers, including certain Bitcoin miners, start to take profits.
Bitcoin Miners Taking Profits
Julio Moreno, head of research at CryptoQuant, noted that some Bitcoin miners began taking profits on November 12, although this activity remained within normal levels. The trend became apparent upon examining exclusive entities holding 100 BTC or more.
Four Key Metrics Indicating Robust Rally
However, four key metrics suggest that Bitcoin’s rally remains robust:
Derivatives Data
- US Treasury Yields: When US Treasury yields rise, it signals that investors are demanding higher returns on these fixed-income securities. Essentially, this indicates that holders anticipate either rising inflation or an increase in government spending, both of which dilute the value of Treasury holdings.
- US Dollar Index (DXY): A strong US dollar relative to other global currencies is more directly correlated with stock market performance, which itself only loosely correlates with Bitcoin’s price. This dynamic occurs as investors view the US economy as better positioned than other major economies, leading to expectations for strong corporate earnings.
Other Metrics
- Bitcoin Derivatives Premium: The current 13% premium indicates that whales and arbitrage desks are moderately excited, a healthy sign given Bitcoin’s all-time high on November 13.
- Bitcoin Options Skew (Put-Call): Recent BTC options data indicate a healthy, neutral market despite a 16% rally in less than three days.
Favorable Macro-Economic Conditions
Unless there is a significant decline in US Treasury yields, investors are likely to continue seeking alternative scarce assets, such as Bitcoin, suggesting that macroeconomic conditions remain favorable. Despite proposals from the new Trump administration to cut government spending, there is little that can be done in the short term, as most changes require legislative approval.
Promising Catalysts for Further Gains
The path for further BTC price gains appears promising, given the crypto-friendly US administration, with a Republican majority in both houses of Congress, alongside a neutral-to-bullish sentiment in Bitcoin derivatives markets. Other potential catalysts, such as Senator Cynthia Lummis’s proposal to increase US Treasury Bitcoin reserves, could easily propel the BTC price above $100,000.
Conclusion
The recent surge in Bitcoin’s price is a testament to its resilience and robust rally amidst favorable macro-economic conditions. Despite some traders’ concerns that the bullish momentum could weaken, key metrics indicate otherwise. The path for further gains appears promising, with potential catalysts on the horizon that could propel the BTC price above $100,000.
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Key Takeaways
- Bitcoin has surpassed the $93,000 mark for the first time amidst a 16% surge from November 11 to November 13.
- Four key metrics suggest that Bitcoin’s rally remains robust: derivatives data, US Treasury yields, US Dollar Index (DXY), and Bitcoin derivatives premium.
- Favorable macro-economic conditions remain in place, with investors likely to continue seeking alternative scarce assets like Bitcoin.
- Potential catalysts, such as Senator Cynthia Lummis’s proposal to increase US Treasury Bitcoin reserves, could propel the BTC price above $100,000.
What’s Next?
As the crypto-friendly US administration takes shape, with a Republican majority in both houses of Congress, the stage is set for further gains. With key metrics indicating a robust rally and potential catalysts on the horizon, the path forward appears promising for Bitcoin investors.