Why did Bitcoin rise in price in the second half of March and how its price will change in the near future?
Bitcoin’s price fell to $37.5 thousand in mid-March, after which it began to rise rapidly. It had risen in price by 28 percent in two weeks by the time it reached $48.1 thousand on March 28.
On April 2, bitcoin is worth $46.8 thousand. What caused the market’s growth in March, and what can we expect in the near future, according to experts.
“Buyers are determined to raise the price above $51,000.”
The cryptocurrency’s price has risen in the last two weeks, owing to the recovery of US stock indices and favorable technical factors. The correlation between Bitcoin and SP500 futures is 0.83 for 30 days and 0.66 for 90 days.
Many cryptocurrencies in pairs with the US dollar or the USDT stablecoin have breached critical price levels. They continued to rise in price after the breakthrough, attracting new investors. The BTC/USDT pair broke through key levels of $42K, $44.5K, and $46K, paving the way for Bitcoin to reach $51K. Buyers are determined to push Bitcoin’s price above $51,000.
Because cryptocurrency, like stocks, is classified as a risky asset, the American stock market will continue to have a strong influence on it. Expectations of an aggressive rate hike by the US Federal Reserve in May have been dampened by a sharp increase in the price of bitcoin and other cryptocurrencies. If the SP500 and Nasdaq indexes continue to rise, we can expect bitcoin to reach $55,000 more quickly.
“Cryptocurrencies make it possible to get more”
The market’s growth in March is a result of investors’ concerns about the global economy’s prospects for a recession and an increase in inflation rates in developed countries to record levels. Investors are looking for ways to save money by investing in assets that can grow in the face of the depreciation of familiar papers and investments.
In the EU, Germany, the United Kingdom, and the United States, inflation has reached its highest level in 40 years. Central bank policy clearly demonstrates that the prospects for tightening monetary policy are already a reality, implying that the yield on traditional instruments will be reduced.
In the United States, Treasury yield inversion indicates a possible recession in the near future as global inflation gains traction and has the potential to last for a long time. Cryptocurrencies provide investors with the opportunity to earn more than other assets, which is why money is pouring into bitcoin and other cryptocurrencies.
The expansion of negative manifestations in the global economy and in the economies of developed countries is expected to exacerbate this trend. It is likely that in the near future, bitcoin and other cryptocurrencies will see an even larger influx of investor funds, implying that their value will rise. During the second quarter of 2022, Bitcoin could return to levels above $60,000.