Bitcoin price rallied today as optimism returned to the market. As of 0920 GMT, the price is up by more than 14% and trading at $6,700, which is its highest level since Friday last week.
Bitcoin is rallying at a time when other asset classes, including stocks and crude oil are rallying. In the US, Dow and S&P futures are up by more than 4%.
There are two primary cause of the current rally. First, the Fed yesterday unveiled new measures to boost the markets. In the statement, the Fed said that it will buy unlimited securities, including risky corporate debt. The new program means that the Fed will print trillions of dollars to cushion the market in a move that could lead to inflation.
Second, Bitcoin price is likely soaring because of demand. In a report earlier today, the Financial Times reported that many investors and individuals were rushing to gold to protect themselves from a weaker dollar. As a result, we can assume that some are also moving to Bitcoin, which was created for times like this.
At the same time, Michael Novogratz, a Bitcoin bull expects BTC to be volatile in the near term but bullish in the long-term. He sent the following tweet:
$btc will continue to be volatile over the next few months but the macro backdrop is WHY it was created. This will be and needs to be BTC’s year.
— Michael Novogratz (@novogratz) March 22, 2020
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Bitcoin Price Technical Analysis
BTC/USD cruised past the important resistance level of 6,400 earlier today as shown on the hourly chart below. As shown on the hourly chart below, I expect the upward momentum to continue. If it does, I expect it to test the psychological-important level of 7,000. I also expect it to be bullish above the 7,000 level, with the next level to watch being the two-week high of 7,140.
On the flipside, it is possible that the pair will find some resistance after hitting 7,000 and make a pullback.
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