Forex Analysis & Reviews: 05.10.2021 - Bank of America starts...

05.10.2021 11:23 AM

Bank of America starts crypto research. Bitcoin funds rose over $ 90 million in just a week

Bitcoin grew over the weekend, and it seems that it will continue to do so until it breaks through $ 48,900. Similarly, other tokens and altcoins skyrocketed, thanks to positive news involving digital assets.

Quite recently, the Bank of America disclosed that it began researching cryptocurrency and digital assets, greatly influenced by the high and growing demand from institutional investors. The bank noted that the number of corporations that mention cryptocurrency in their earnings reports has increased from 17 last year to 147 in the last quarter, and involves not just bitcoin, but other digital assets as well. They said it creates "an entire ecosystem of new companies, new opportunities and new applications."

This provoked interest from investors, but the prices do not seem attractive at first glance. Nevertheless, Bitcoin remained afloat, and its return above the 200 MA provoked a new bullish trend.

Comments from Fed Chairman Jerome Powell last week that the central bank will not ban cryptocurrencies also helped Bitcoin rise. The statements were very surprising because recently, China decided to ban cryptocurrencies. But there is no doubt that it is becoming "mainstream", which further fuels the interest of those who have not yet participated in it.

Another good news was the over $ 90 million investment in digital assets. CoinShares reported that Bitcoin-focused funds alone rose $ 69 million, which indicates a reversal in the outflow trend seen earlier this summer. "We believe this decisive turnaround in sentiment is due to growing confidence in the asset class among investors and more accommodative statements from the US Securities and Exchange Commission and the Federal Reserve," the company said.

Ethereum-focused funds, meanwhile, took in $ 20 million.

Regarding other altcoins, a slight decrease can be seen in terms of interest. Funds focused on Binance's BNB token, Polkadot and Tezos experienced minor outflows of $ 800,000 each, while funds tied to the newer and more modern Cardano blockchain have received an inflow of $ 1.1 million. Solana raised about $ 700,000.

Looking at the charts, it is clear that with each decline in Bitcoin, new money entered. And the larger the correction was, the more the volume of incoming funds increased. This is a sign that the money of large players is returning to the market.

That being said, a rise above the 200 MA ($ 48,700 - $ 48,900) will allow Bitcoin to hit $ 51,000, $ 54,400 and $ 58,000. But a decline below the level could result in a drop to $ 45,000, $ 42,700 and $ 40,000.