Bitcoin prices climbed to a three-week high on Wednesday, April 8, after the US and Iran reached an initial ceasefire agreement, boosting the appetite for riskier assets.
The world’s largest jumped as much as 4.9% to $72,738 — its highest level since March 18 — before trimming gains to trade around $71,300 by midday. Smaller cryptocurrencies also posted strong advances, with Ether surging as much as 7.4% to $2,273.
Despite the rebound, Bitcoin remains more than 40% below its record peak of over $126,000 set in October last year.
What’s driving bitcoin prices?
The rally in the cryptocurrency came after tumbled as US President Donald Trump agreed to pause attacks on Iran for two weeks, boosting expectations that the key Strait of Hormuz could reopen.
Markets have been volatile since the conflict erupted in late February, amid fears that major disruptions to oil supply would fuel inflation and hinder economic growth.
According to Akshat Siddhant, Lead quant analyst, Mudrex, the rally was also supported by strong institutional demand, with ETFs recording $471 million in inflows, the highest in six weeks. Additionally, about $400 million in short positions liquidation further amplified the move.
Bitcoin has largely traded within a band of about $60,000 to $75,000 since the US-Iran war escalated in late February, briefly climbing close to $76,000 before pulling back. Over the past couple of weeks, it has mostly remained below the $70,000 mark.
Where are bitcoin prices headed?
According to Avinash Shekhar, Co-Founder & CEO, Pi42, this phase reflects improving confidence after recent volatility, where dips continue to be met with buying interest.
“This reinforces the view that the current trend remains constructive, with market participants closely watching macro developments for the next directional trigger,” Shekhar said.
On the technical outlook, Siddhant of Mudrex, said that currently trading at $71,300, BTC’s long-term uptrend will depend on further geopolitical clarity and macroeconomic figures such as the US CPI data.
“If the momentum continues, BTC could move towards the $75,000 level, confirming a breakout, while the support lies at the $68,000 zone,” he added.
Disclaimer: This story is for educational purposes only. Please consult with an investment advisor before making any investment decisions.