Key Reasons Why Bitcoin & Crypto Market Are Rising Today

The August 5 local bottom has attracted institutions and whales to accumulate Bitcoin (BTC), triggering a crypto market comeback. As a result, BTC has shot up nearly 6% in the past week, catalyzing altcoins to soar. Additionally, the crypto market capitalization has shot up from close to $2.0 trillion to $2.2 trillion, indicating a strong bullish market outlook. 

From a short-term market structure perspective, Bitcoin price is well-positioned to continue its uptrend. From a mid-to-long-term outlook, however, the bias gets a bit more complicated due to the upcoming events that could sway the crypto markets in any direction.

Crypto Market Events This week

Here are two major crypto market events that could heighten volatility. 

• The US Consumer Price Index (CPI) on Thursday will play a pivotal role in affecting the bias for BTC in the short term. It will also set the tone for the US Federal Reserve’s highly-anticipated interest decision in September.  

• The estimated date for the FTX Repayment Process Voting could occur on Friday and can impact crypto markets as creditors are set to receive $12.7 billion.

The July inflation data is a key macroeconomic event that has a major impact on investor decisions. Although there are possibilities that inflation might come in slightly hotter than expectations, investors are not expecting major changes in the Fed’s decision in September. In such a case, Bitcoin price prediction forecasts the recovery rally could continue.

On the other hand, if inflation comes in lower, sparking concerns about an economic slowdown, then it could prompt a correction in BTC price. 

Bitcoin Price Likely To Remain Bullish This Week

Historical data for the past year shows that Mondays, Wednesdays, Saturdays, and Sundays have net positive returns. These are the days investors should consider booking profits. On the contrary, Tuesdays have been the best time to buy dips in Bitcoin and altcoins. For the rest of the week, investors can expect the crypto market to continue its uptrend except for minor dips on Thursday and Friday. Based on this historical data, the crypto market will likely remain bullish this week.

Three Events Could Shape Crypto Market Outlook In Long Run

While the US CPI and daily average return can provide short-term bias for crypto markets, three key events could profoundly impact crypto investing patterns in the coming months.

1. FTX Creditors: The $12 billion in cash distribution to FTX creditors is liquidity that could flow back into the crypto markets, improving the odds of continuing the bull rally. 
2. US Presidential Elections: Donald Trump’s win could catalyze pro-crypto regulation, but the odds have turned in Kamala Hariss’ favor, which could be a major hurdle to Bitcoin’s bull run.
3. Fed’s September Rate Cut Decision: The September rate cut is highly anticipated and could make or break the crypto market bull run.

“If Democrats soften their position on crypto, the correlation between Trump victory odds and BTCUSD could break down,” said Galaxy Digital’s Alex Thorn and Gabe Parker in an email. Thorn and Parker further outlined that while the above three events are somewhat bullish for crypto markets, macro concerns and government-held crypto movements are two factors that could increase the downside risk for Bitcoin price and the broader crypto markets. 

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Akash Girimath

Akash Girimath is an engineer at core, but is interested in the chaos of the financial markets. Akash is senior report and analyst who also trades cryptos on a regular basis and maintains a small crypto fund for friends and family.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.