Despite the recent Tether/Bitfinex news – where New York’s attorney general accused the operator of the Tether stablecoin and BitFinex crypto exchange of making illicit transactions to cover up losses of nearly $1 billion – the crypto markets are surging.
While news like this should potentially be detrimental for crypto, the markets are green across the board. This upwards price action can largely be attributed to people exiting Tether (USDT) and buying Bitcoin (BTC) and Ethereum (ETH).
In Bitcoin alone, the exchange between USDT and BTC has exceeded $1.29 billion in the past 24 hours.
Is This Crypto Run Sustainable?
The crypto markets continue to hold up strong, with Bitcoin and Ethereum close to and approaching their local highs. However, given the reason for this recent price rise, are these price levels sustainable?
A new report from Bloomberg published on April 29 suggests Bitcoin’s rally is losing steam and that we are now due for a correction.
Per the report, a technical indicator called the GTI Vera Convergence Divergence indicator is flashing signals that suggest a trend reversal to the downside is near. The aforementioned indicator is used to detect trend reversals and has not triggered a sell signal since mid-March.
Therefore, as Bitcoin hovers near yearly highs and is continuously propped up by people exiting Tether, there is a strong potential that a downside may be ahead, especially when the Tether exiting subsides.
Moreover, another indicator suggesting Bitcoin is due for a pullback is that Bitcoin’s price hit the 61.8% Fibonacci resistance level. This suggests that Bitcoin will fall back and retest lower support before attempting to break through this significant Fibonacci level.
Do you agree with this analysis that Bitcoin is due for a pullback before it attempts to break through its yearly highs? Let us know what you think in the comment section below.
