Key Points
- Bitcoin’s price has hit $71,000 for the first time in nearly 40 days, leading to a fear and greed index of 76.
- The liquidation heatmap identifies $76,900 as the next potential price target for Bitcoin.
Bitcoin’s price recently reached a notable $71,000, a first in approximately 40 days. This surge has brought a renewed sense of optimism to the market.
This price increase is in line with a recent analysis that suggested the bull run was still ongoing.
Factors Contributing to BTC’s Recovery
Aside from the factors mentioned previously, there were other reasons for BTC’s recovery. One significant factor was the Bitcoin ETFs. These are not the same as BTC but suggest an investor’s exposure to Bitcoin. Consequently, if the cryptocurrency’s price rises, the ETF Net Asset Value (NAV) would also increase.
In early 2024, billions of dollars were invested in Bitcoin ETFs, leading to an all-time price high. However, the issuers failed to attract the same level of capital during the first part of the second quarter, leading to a slump in BTC’s price.
This trend has since reversed, with the total netflow into Bitcoin ETFs reaching $235 million as of May 20th. This indicates that companies like ARK, BlackRock, Fidelity, and Grayscale have seen inflows for four consecutive days. If this trend continues, Bitcoin’s price could surpass $73,000 before the end of May.
Fear and Greed Index and Liquidation Heatmap
Another factor to consider is the fear and greed index. According to Glassnode, Bitcoin’s fear and greed index returned to 76, an increase of 8.57% in the last 24 hours. This implies that the market is currently in a greedy state. The last time BTC hit a new high, the metric reached 90, indicating an extremely greedy market.
Currently, Bitcoin is not in a state of exaggerated positive investor sentiment. Given this, the coin’s price could still rise, potentially nearing $75,000 within a few days.
Moreover, it’s worth mentioning that $96.87 million worth of BTC contracts were liquidated in the last 24 hours. Short liquidations accounted for almost $80 million, with the remainder being longs.
The liquidation heatmap also suggests that Bitcoin could surpass its all-time high, with a target of $76,900 potentially being the next peak.
