Bitcoin breaks above 50-day M.A. for the 3rd time in 30 days

Bitcoin is trading sharply higher over the past 24 hours and as of 5:00 PM EST, is changing hands at around $42,200. There are several fundamental reasons for this recent surge including President Biden’s executive order, and the compromise between Russia and Ukraine leading to a rally in the stock market.

While President Biden’s long awaited executive order on digital assets was seen as supportive to the sector. Some were predicting that Biden would be harsher on cryptocurrencies such as Robert Kiyosaki tweeting, “Prediction. Biden to sign EXECUTIVE ORDER regulating Cryptos. NEXT: Fed Crypto. NEXT: all crypto currencies seized & folded into GOVERNMENT crypto…”

The landmark executive order prematurely advanced the price of Bitcoin due to a leak from the Treasury Department’s Janet Yellen released a statement yesterday which let out some of the details ahead of schedule.

This led to a run up in which Bitcoin gained $4,000 in value in a four-hour period.

Chart 1 Biden’s order outlined six key areas for the government to examine the benefits and risks of. They include consumer protection, financial stability, illicit activity, U.S. competitiveness, financial inclusion and responsible innovation. It also suggested that the Federal reserve continue to research into a digital dollar, but stopped short of announcing that one would be released. The digital dollar coming to be would in no way be the nail in Bitcoin’s coffin because it would still be intrinsically centralized and inflationary just as much as the physical counterpart and in fact would be more intrusive into the user’s freedom as it can be controlled and tracked much more easily.

The recent rise was also helped along by re-sparked risk-on sentiment that took the Nasdaq higher by 3.59%. This pop in the indexes is largely due to some resolution in Ukraine seeming probable, with the Ukrainian president reportedly closer to negotiating with Russia’s demands.

Bitcoin’s rise over the past few days can’t be viewed as an exit from the accumulation phase it currently is in. To make that determination Bitcoin would have to have a clear-cut breakout above $44,275 or below $30,000. The latter of these two directions is becoming less likely however, as buyers seem eager to snatch up Bitcoin whenever dipping to the low $30,000’s.