It was a bullish Friday session, with BTC rising 9.14%, to end the day at $27,351. BTC decoupled from a bearish NASDAQ Composite Index, as investors responded to a growing crisis within the US banking sector. Technical indicators are bullish, with $30,000 in sight.
On Friday, Bitcoin (BTC) jumped 9.14%. Following a 3.04% gain on Thursday, BTC ended the day at $27,351. Significantly, BTC revisited the $27,000 handle for the first time since June 2022.
A mixed start to the day saw BTC fall to an early low of $24,954. Moving away from the first major support level (S1) at $24,427, BTC surged to a last-hour high of $27,563. BTC broke through major resistance levels to end the day at $27,351.
Growing US Banking Crisis and Fed Bailouts Boost BTC Demand
The retreating contagion from Silicon Valley Bank and Signature Bank (SBNY) was short-lived. On Friday, news hit the wires of SV Financial Group (SIVB), the former publicly traded parent company of Silicon Valley Bank, that it filed for bankruptcy.
The news that SV Financial Group filed for bankruptcy coincided with reports that First Republic Bank was bailed out by 11 banks to prevent the collapse of a fourth US bank. There were also reports of banks borrowing a record $164.8 billion from two Federal Reserve facilities.
Alarmingly, the previous high was $111 billion during the 2008 global financial crisis. The reports were enough to fuel demand for BTC as investors dilute risks of exposure to the banking sector.
US economic indicators took a backseat, and disappointing consumer confidence numbers failed to dampen BTC’s rally. According to preliminary numbers, Michigan’s consumer confidence index fell from 67.0 to 63.4 versus 66.9 expected.
The NASDAQ Composite Index fell 0.74%, and the Dow and S&P 500 posted losses of 1.19% and 1.10%, respectively.
US regulators and lawmakers could intensify scrutiny of the digital asset space to divert attention from problems in the banking sector. The US administration and regulators may be aggrieved by BTC’s performance this week considering the Fed bailouts.
Bitcoin (BTC) Price Action – Technical Indicators
This morning, BTC was up 0.03% at $27,359. A choppy start to the day saw BTC fall to an initial low of $27,004 before rising to a high of $27,452.
BTC needs to avoid the $26,623 pivot to target the first major resistance level (R1) at $28,291. A move through Friday’s high of $27.563 would indicate an extended bullish session. Crypto news wires need to be crypto-friendly to support a prolonged rally.
In the event of a prolonged rally, BTC would likely test the second major resistance level (R2) at $29,232, and resistance at $30,000. The third major resistance level (R3) sits at $31,841.
BTC settled above the 50-day EMA ($24,149). The 50-day EMA has turned away from the 100-day EMA, and the 100-day EMA has turned away from the 200-day EMA, sending bullish signals.
A hold above S1 ($25,682) and the 50-day EMA ($24,149) would support a break out of R1 ($28,291) to target R2 ($29,232) and $30,000. However, a drop-through S1 ($25,682) would bring the 50-day EMA ($24,149) and S2 ($24,014) into view. A drop through the 50-day EMA would send a bearish signal.
By Audy Castaneda
