Bitcoin rose further on Tuesday, building on its gain Monday amid continued optimism that an exchange traded fund based on the crypto will be soon approved in the U.S.
The cryptocurrency
BTCUSD,
rose more than 11% to as high as $35,144 on Tuesday, the loftiest level since May 2022, according to CoinDesk data. Bitcoin has gained over 105% so far this year, while still down 50% from its all-time high in 2021.
Bitcoin rallied this week as investors celebrated incremental steps that might bring bitcoin ETFs closer to the market, with anticipation that the U.S. Securities and Exchange Commission will approve them soon, after repeatedly rejecting such applications in the past, citing their vulnerability to market manipulation.
“We believe the market has started to price in an approval as the base case,” analysts at QCP Capital wrote in a Tuesday note.
Some investors are also turning to bitcoin as a potential safe haven asset, as the Israel–Hamas war intensifies, according to Patrick Munnelly, market analyst at Tickmill Group.
A short squeeze, where traders with short positions are forced to buy bitcoin to cover their losses, also contributed to the rally, Munnelly said in emailed comments. About $186 million short bitcoin positions were liquidated over the past 24 hours, according to CoinGlass data.
From the technical perspective, the short-term indicators are showing a bullish trend for bitcoin, with it facing the new key resistance level at $35,924, according to Munnelly.
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