• BTC price caps $4K weekly gains: 5 Bitcoin developments to watch this week

  • Bitcoin (BTC) is an enthralling bull as it enters a new week after closing a weekly candle in which it gained another $4,000 — will it hold?

    After spending the previous seven days hitting and then falling from local highs, the sentiment was mixed heading into the weekend.

    In the end, Saturday and Sunday delivered exactly what bulls had hoped for, with Bitcoin breaking through multiple resistance lines and topping $45,000.

    With a sense that there is everything to play for, bulls are now confident, but they are also aware that anything can happen in Bitcoin.

    Tuesday is the deadline for the infrastructure bill, as it was last week. The specter of US legislators looms over the cryptocurrency industry on Monday, as it did last week.

    The infrastructure bill, as it is colloquially known, is still the subject of heated debate and is expected to be put to a vote on Tuesday.

    A $30 billion cryptocurrency issue is included in the $1 trillion bills, which seeks to reform business tax obligations. This has sparked outrage in the industry, to the point where U.S. senators have tabled amendments to change the bill’s language.

    With the Tuesday deadline looming, market participants are now accepting that, even if the outcome is not favorable, the crypto element has at least been brought to everyone’s attention.

    “The first thing crypto had to do in this situation was to make sure that Washington was aware that there was a provision in the bill that needed clarification. That was a success! “In a series of tweets about the bill on Sunday, Sam Bankman-Fried, CEO of exchange platform FTX, said.

    “Washington is well aware now.” With little to do but wait, markets may continue to be sensitive to rumors and general speculation about the bill until it is finalized.

    Bankman-Fried concluded that any criticism from the cryptocurrency community should be construed positively.

    “But, fundamentally, the most important thing right now isn’t for crypto to ‘get its voice heard,’” he added.

    “It’s to come forward with reasonable, good-faith compromises, and make it clear that’s the goal.” Gold hits 4-month lows Away from the paperwork, the overall macro environment presents a mixed picture for Bitcoin.

    Stocks are underwhelming following an early drop in precious metals, which began Monday with a bang and may help to explain the drop in crypto markets.

    After beginning at $1,763, gold fell sharply and even saw a wick to $1,686 before recovering, capitalizing on Friday’s losses and reaching its lowest level since the end of March.

    While Bitcoin has traditionally benefited from rising gold prices and vice versa, proponents of the cryptocurrency were quick to mock the market.

    “We’ll be watching the collapse of gold’s market cap in real time over the next decade,” investor and podcast host Anthony Pompliano said.

    “Will be so obvious in hindsight,” others said, referring to the correlation between Bitcoin’s outperformance and Senate progress, implying that the tide may yet turn.

    Bitcoin price action outperforms resistance In that context, Bitcoin, in particular, has performed uncannily well in recent days, much to the chagrin of bears everywhere.

    On Bitstamp, the weekend saw a push to highs above $45,400, signaling a turning point before a relatively modest correction to around $43,500.

    That level was still a focus at the time of writing, with BTC/USD closing a weekly candle of nearly $4,000.

    “BTC fully confirmed a breakout from a multi-month range this week,” trader and analyst Rekt Capital summarized.

    “BTC reclaimed the 200-day exponential moving average (EMA) as support, a long-term indicator of investor sentiment. BTC also retested the 21-week EMA as support, which is a tried-and-true Bull Market indicator. It’s been a fantastic week.” These averages had previously alarmed analysts, with Bitcoin struggling to make progress for much of the previous week.

    A look at buying and sell levels among Binance traders, for example, reveals the extent of the support/resistance “flippening” that has occurred. While sellers have settled in higher up above Sunday’s highs, $41,500 has become firm support.

    “Good green week for the markets,” said co-trader Michaal van de Poppe.

    “I am very interested to see if the coming week will be another green week, or if a healthy correction occurs for Bitcoin and Ethereum.” Difficulty approaches multi-month record uptick The party is undoubtedly continuing among Bitcoin fundamentals this week, with both hash rate and difficulty rapidly increasing.

    After fluctuating between two and three figures, hash rate estimates now place hardware commitment to Bitcoin firmly above 100 exahashes per second (EH/s).

    Monday’s reading of 105 EH/s is more than 20 EH/s above June lows and about 63 EH/s below all-time highs.

    The difficulty, which saw its first positive readjustment in two and a half months at the end of July, is poised to outdo itself in three days and jump over 7%.

    Both fundamentals point to a strengthening mining setup, aided by displaced Chinese miners moving to new jurisdictions and hardware being shipped elsewhere.

    Willy Woo, a statistician, has been analyzing behavior since mid-July and has commented on the relationship between rising fundamentals and spot price — the “price follows hash rate” mantra.

    “Fundamentals do not predict short-term price,” he said, “but given enough time, price discovery reverts to fundamentals.”

    According to an accompanying chart depicting the decreasing BTC supply, BTC/USD is currently valued at more than $53,000.

    The market has already flirted with “extreme greed.”

    Meanwhile, the correlation between price and market sentiment may give those betting on a sustained uptick even more reason to be concerned.

    The Crypto Fear & Greed Index, which was only a few days ago in “neutral” territory, quickly flipped to “greed” territory over the weekend.

    The Fear & Greed Index considers a variety of sources to create an index for cryptocurrency as a whole ranging from 0 to 100, with 100 representing maximum greed.

    Despite BTC/USD rising by a comparatively modest $5,500 over the week, the Index reached 74/100 on Sunday, bordering on “extreme greed.”

    “This Is An Extraordinary 3-Months High,” investor and analyst Vince Prince said in response to the rapid pace of change.

    Fear & Greed returned to 65 on Monday, still denoted as “greed.” During the peak of bull runs, scores of 95/100 appear, with this zone coinciding with subsequent drawdowns.

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