The summer lull drags on in the crypto market, with Bitcoin trading sideways and investors growing impatient. However, beneath the surface, some interesting signs suggest a big shift could be coming soon. Analysts are increasingly bullish on Bitcoin’s prospects for the fourth quarter, and whispers of China potentially reversing its crypto ban have sent shockwaves through the industry.
Is a crypto bull run coming? Here are the clues.
What’s New in China?
One of the biggest rumors creating buzz is that China might lift its ban on cryptocurrency trading. In a recent tweet, Tron founder Justin Sun hinted that China could soon allow its citizens to trade and mine crypto again.
Earlier this year, China allowed certain crypto activities in Hong Kong, including launching ETFs and retail trading. If these permissions extend to mainland China, the extra capital flowing into the market could further fuel optimism for the rest of 2024.
Bitcoin Stuck in a “Boring Zone,” But Change Is Coming
Though the crypto market may seem stuck right now, with Bitcoin moving sideways, macro investor Raoul Pal refers to this phase as the “boring zone”—a period of calm before bigger changes. Despite the quiet, there are signs of potential strength ahead.
For instance, the stock market, particularly the S&P 500, has seen a V-shaped recovery, suggesting resilience. Meanwhile, the Relative Strength Index (RSI) for the S&P 500 remains below overbought levels, adding to the positive outlook.
Weaker Dollar Could Give Bitcoin a Boost
Another important factor is the weakening US Dollar Index (DXY). Historically, when the dollar declines, Bitcoin tends to benefit. This inverse relationship suggests that as the dollar loses strength, Bitcoin could pick up momentum.
Institutional Investors Bet Big on Bitcoin
Traditional financial institutions are also increasing their bets on Bitcoin. Recent SEC filings show that Morgan Stanley and Goldman Sachs have significantly boosted their holdings in Bitcoin-related funds, including BlackRock’s Bitcoin ETF. This growing institutional interest highlights the increasing confidence in Bitcoin’s long-term future.
With September around the corner, all eyes are on the crypto market to see if these factors will drive a breakout and turn this quiet summer into a booming season for crypto.
Also Check Out: Crypto Regulations In China 2024
This could be the beginning of a new crypto era. Are you ready?
