After closing the first three weeks of May with a bearish outlook, Bitcoin price edged 3 percent higher in the past 24 hours to trade around $28k during the early Asian market on Monday. More than $42 million out of $52 million in Bitcoin liquidation in the past 24 hours were short traders.
As a result, the CME Group Bitcoin’s futures opened the week with a huge gap that suggests the market will fall again in the near term.
Nevertheless, the Bitcoin CME futures had left a market fat of around $29.6k, thus dividing crypto traders on which gap will be filled next.
The Bitcoin market continued to enjoy the high inflation rocking many countries led by the United States as it struggled with the debt ceiling crisis. Currently, the United States debt stands at around $31.4 trillion. However, the Biden administration agreed on bipartisan talks to support a debt ceiling raise and cut government spending to avoid a default for the first time in the country’s economic history.
President Joe Biden and House Speaker Kevin McCarthy announced on Sunday that they have reached an agreement to raise the debt ceiling by a few trillion but cut the government’s spending.
“Speaker McCarthy and I reached a bipartisan budget agreement that will prevent the worst possible crisis – a default for the first time in our nation’s history. This deal is good news for the American people. I strongly urge Congress to pass the agreement right away,” President Biden noted.
Basically, the Federal Reserve received a green light to continue printing more money despite the claim of fighting the dollar inflation that hit hard countries holding it as a reserve currency. No wonder the BRICS movement led by Russia and China has been gaining significant momentum around the world through de-dollarization. Nevertheless, the United States dollar controls a significant amount of global reserve currency amounting to over 55 percent.
As a result, investors continue to proliferate the so perceived risky assets like Bitcoin in a bid to hedge against rising inflation. According to on-chain data provided by Glassnode, Bitcoin Shrimp Entities, holding less than 1 BTC, continued to aggressively accumulate more coins in the recent past. Precisely, Bitcoin Shrimps have added more than 24.6k BTCs YTD and have an ATH supply of about 1.31 million.
Similarly, Bitcoin long-term holders have been aggressively accumulating in anticipation of next year’s halving event, which has been observed to trigger the wider crypto bull market.
Bitcoin price has been having diminishing returns on the new year’s relief rally, thus suggesting a possible reversal in the near term. However, popular crypto influencer Lark Davis thinks Bitcoin price is headed for more gains in the short term perspective.
