4 Reasons to Buy Bitcoin Under $70K

Bitcoin has climbed above the $70,000 threshold for the first time in six weeks, hitting a new six-week high. This milestone indicates the wisdom of buying Bitcoin during its dip below $70,000. The digital currency reached $71,401 on May 20, marking a price level not seen since April 9. As Bitcoin regained its psychological resistance of $70,000, its funding rate showed a significant increase.

The funding rate for Bitcoin rose to 0.0187%, the highest it has been since April 9. This data suggests that traders are largely optimistic, favoring long positions in Bitcoin. A positive funding rate typically means that traders are willing to pay a premium to maintain their long positions, highlighting a bullish sentiment. Prior to this rally, the funding rate had remained below 0.01% for the past month, indicating a growing confidence among Bitcoin buyers.

On a technical level, Bitcoin’s price charts are showing signs of further upward movement. A four-hour Bitcoin chart has recently revealed an inverse head and shoulders pattern. Traders often use this pattern to spot potential reversals from a bearish stance to a bullish one. Popular cryptocurrency analyst Moustache pointed out this pattern and implied that it foretells more upward momentum. According to his analysis, other cryptocurrencies, or altcoins, will follow Bitcoin’s lead.

In addition to pattern analysis, fractal analysis sheds more light on Bitcoin’s prospects. Fractals are recurring technical chart patterns that repeat across various timeframes. Bitcoin’s current rally on the weekly chart bears a striking resemblance to its performance in November 2021. Back then, after a low of $31,000 in July, Bitcoin soared to $69,000 by November. If Bitcoin follows this historical pattern, we may witness significant further gains in the coming weeks.

Further reinforcing this bullish outlook, Bitcoin’s price movement also mirrors its bull run in 2017, according to another seasoned analyst, Jelle. He remarked that Bitcoin seems to be following the same trajectory as it did during the 2017 bull market. Although turbulent around previous cycle highs, once Bitcoin clears these hurdles, smoother advancements could follow.

Institutional investment into Bitcoin is also contributing to its recent climb. For two consecutive weeks, U.S. Bitcoin exchange-traded funds (ETFs) have recorded positive inflows, reversing three prior weeks of net outflows. These ETFs cumulatively gathered over $200 million worth of Bitcoin in the previous week and amassed a larger total of over $413 million on the week of May 6. On May 20 alone, Bitcoin ETFs saw positive inflows of over $235 million, exceeding the inflows of the previous week.

The surge in institutional investment via Bitcoin ETFs is a major factor in Bitcoin’s current rally to new highs. By mid-February, Bitcoin ETFs accounted for roughly 75% of all new investment in the world’s most prominent cryptocurrency as it surpassed the $50,000 mark. This influx of institutional funds underscores the growing confidence in Bitcoin’s potential for further growth.

All these factors collectively build a compelling case for Bitcoin’s continuing rise. Leveraged long positions, positive fractal patterns, historical similarities, and strong institutional investment are all aligning to create a favorable market environment for Bitcoin. This combination of technical and fundamental factors makes a strong argument for keeping an eye on Bitcoin’s ongoing performance and potential growth.