Bitcoin’s Ascent to $90,000: A Tale of Diverging Paths with Gold
As gold prices hit record highs, economist Peter Schiff predicts further gains driven by potential Fed rate cuts, while Bitcoin continues its own rally toward $90,000 amid strong ETF inflows. This article explores the contrasting trajectories of these two assets and what it means for investors.
Peter Schiff Predicts Gold to Soar, Bitcoin Trails
Gold prices have reached new record highs, prompting economist Peter Schiff to predict further increases. Schiff, a frequent critic of Bitcoin, cited potential interest rate cuts by the U.S. Federal Reserve as a factor that could push gold prices even higher. Meanwhile, Bitcoin has failed to keep pace with gold’s surge.
Bitcoin Extends Gains Toward $90,000 Amid High ETF Inflows
Bitcoin’s price has been on an upward trajectory, trading above $88,000 on Tuesday after a nearly 3% rise the previous day. This recent price rally is being supported by institutional demand, as evidenced by the US spot Bitcoin ETFs recording an inflow of $381.40 million on Monday, the highest since January 30. Additionally, Microstrategy announced a new purchase of 6,556 BTC for $555.8 million, further indicating strong institutional interest in Bitcoin.
Bitcoin Encounters Resistance Above $88K
Bitcoin’s (BTC) recent bullish advance has hit a resistance zone above $88,000. The primary hurdle is the 200-day simple moving average (SMA) at $88,356, a key indicator of long-term momentum. In March, a break below this SMA signaled a potential crypto winter. Therefore, a move above this level would signify a renewed bullish shift. Additionally, the Ichimoku cloud’s upper end is NEAR the 200-day SMA, and a breakout above it would also reflect a bullish momentum shift.
BlackRock and Ark Invest Make Significant Bitcoin Purchases
On April 21, data from Farside Investors revealed that BlackRock’s IBIT Bitcoin ETF bought $41.6 million worth of BTC. This was outpaced by Ark’s 21Shares BTC ETF, which purchased $116.1 million worth. Fidelity and Bitwise also invested, with $87.6 million and $45.1 million in BTC respectively. These purchases coincided with a surge in BTC’s price, which is currently up across all time frames, with gains of 0.9% daily, 3.1% weekly, 11.3% in 14 days, 4.9% monthly, and 33.8% since April 2024, according to CoinGecko. Other bullish developments may have also contributed to BTC’s recent rally.
Dollar Drops, Stocks Slide, But Bitcoin Rallies as Trump Targets Fed and Powell
On April 21st, President Donald Trump intensified his criticism of Federal Reserve Chairman Jerome Powell, calling him a ’major loser’ and warning of potential economic downturns unless interest rates are cut. Trump emphasized on Truth Social that the U.S. economy could face a slowdown if Powell does not take immediate action to lower interest rates. With prices declining, Trump argues that inflation seems unlikely, but a recession could be imminent if the Federal Reserve does not adjust its policies. Notably, Bitcoin rallied despite the overall market turmoil.
Bitcoin Recovery Raises Questions Amid Derivatives Activity Spike
Bitcoin has recovered in recent weeks, nearing $89,000. This reversal follows losses triggered by US President Donald Trump’s unexpected declaration. However, a notable surge in 24-hour open interest in derivatives has raised concerns about the sustainability of the current market rally. Historically, price pumps fueled by derivatives have tended to lack long-term stability. CryptoQuant’s analysis highlights a significant increase in open interest, echoing similar spikes observed during a bullish phase in late 2024. This uncertainty suggests potential weakness ahead for Bitcoin and the broader market.
