Cryptocurrency traders expect Bitcoin (BTC) to retest its all-time high of just under $74,000 U.S. in coming months as investor sentiment towards riskier assets turns bullish.
Singapore-based QCP Capital said in a note to clients that investors are moving capital back into riskier assets after the latest inflation data in the U.S. came in weaker-than-expected, bolstering expectations for interest rate cuts this year.
Following the April inflation data being released, Bitcoin regained the $66,000 U.S. mark for the first time since April and posted its biggest one-day increase since March of this year.
Bitcoin continues to hold above that level and is currently trading at $66,250 U.S.
“We expect bullish momentum here that could take us back to the highs of nearly $74,000,” wrote QCP traders in their note to clients.
The trading firm also expects Bitcoin to benefit from growing institutional demand, with large funds investing 3% of their assets under management (AUM) in Bitcoin spot exchange-traded funds (ETFs).
The bullish call on Bitcoin comes after weeks of slumping prices and low volatility following a halving event in April that reduced by 50% the available supply of BTC that can be mined.
Since hitting an all-time high on March 14 of this year, Bitcoin’s price had dropped as low as $58,000 U.S.
However, the price of the largest cryptocurrency by market capitalization has been steadily rising in recent days. Year to date, Bitcoin’s price has increased 50%.
