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Bitcoin Eyes Bull Run Towards $40K Ahead of Biden’s Stimulus Plan

Bitcoin Eyes Bull Run Towards $40K Ahead of Biden’s Stimulus Plan

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US Fiscal Deficit hits worst levels in 40 years.

Bitcoin Rally Resumes Momentum

Stablecoin Inflow

Many traders noted that the cryptocurrency would reclaim its previous peak–and form a new one in the sessions ahead. One of them–a pseudonymous analyst–noted that Bitcoin flipping $36,500 from immunity to support provides it an ideal footing to continue its rally into a new high.
Stablecoin inflows into crypto exchanges rise as Bitcoin reclaims $37K. Source: CryptoQuant
Meanwhile, another analyst drew two sloping trendlines around Bitcoin’s recent disadvantage correction and pullback move, which makes it look like a Bullish Pennan structure. That also hinted at an upside continuation–just as much as the size of the prior upside move, which easily puts Bitcoin en route to over $42,000.
Stablecoins, for example Tether, behave as de-factor dollar tokens because of their 1:1 pegging with the greenback. Tether’s supply increased from $20 billion to $24 billion over a month, pointing to greater demand.

Mr. Biden’s stimulus bill prospects also coincided with an increase in stablecoin deposits across all the exchanges. Data analytics firm CryptoQuant noted that the sideline capital moved back into the trading platforms, pointing to a potential uptick in cryptocurrency purchasing.
pic.twitter.com/biiSWpUSE3

His bill might contain financial aid for state and local authorities and a direct check payment worth at most $2,000 to American households. Tom Block, Washington policy analyst at Fundstrat Global Advisors, told CNBC that the Thursday bill could also have an extension of the eviction moratorium and”hundreds of billions” in government aid.


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“Reclaim $39.5k second and then we can attack the highs,” he maintained.

Bitcoin extended its recovery trend since traders changed their attention on Joe Biden’s stimulus plan expected later on Thursday, hoping that a generous spending package would pressure the US dollar and boost demand for other safe-haven assets.

Bitcoin, cryptocurrency, BTCUSD, BTCUSDT
Friday’s labor market data, which revealed that companies trimmed about 140,000 jobs in December, has increased the need for bigger government spending. Bulls in riskier markets see it as a hint for a weaker US dollar beforehand. Meanwhile, Bitcoin speculators see the entire macroeconomic development as a catalyst to push the cryptocurrency to another record high.

“Bernie Sanders takes over funding with total deficit worst in 40 years,” said macro analyst Dan Tapiero on the newly-appointed chairman of the Senate Budget Committee. “Interest rates cannot rise with a huge debt load. [The] dollar bear market must continue or equities will suffer. [A] perfect backdrop for gold and bitcoin.”
The benchmark cryptocurrency did react well to the stimulus narrative. Its speed per token surged to $38,800 in an early London session, up about 29 percent from its session low near $31,000.

Bitcoin, cryptocurrency, BTCUSD, BTCUSDT

— MMCrypto (@MMCrypto) January 14, 2021

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