Decentral Block Post

Bitcoin (BTC) made a new 52-week high on June 23, indicating that bulls are on fire. Buyers have managed to hold onto a large part of the gains made during the week, signaling that they are in no hurry to book profits. Bitcoin climbed 16% this week, outperforming the S&P 500 Index, which fell 1.39%.

Not only Bitcoin but even Ether (ETH) is showing signs of starting a bullish move. Glassnode data shows that Ether balances on exchanges dropped sharply in the past 30 days and hit a new low of 12.6%.

A similar dip in Ether exchange balances happened in November 2022, which was followed by a sharp rally of 33%. Although a rally is possible, traders need to be cautious because the fall in exchange balances this time may have been triggered by the U.S. Securities and Exchange Commission’s actions against Binance and Coinbase.

The crypto recovery is not limited to Bitcoin and Ether. Several altcoins have risen sharply from their respective lows, indicating solid buying at lower levels. This implies that the bearish sentiment may be waning.

Could the return of the buyers start a new bull move in cryptocurrencies, or will higher levels attract selling by the bears? Let’s study the charts of the top-five cryptocurrencies that may rise in the short term.

United States Government bonds, or Treasurys, have a tremendous influence across all tradeable markets, including Bitcoin (BTC) and Ether (ETH). In that sense, risk calculation in finance is relative, so every loan, mortgage and even cryptocurrency derivatives depend on the cost of capital attributed to U.S. dollars.

Assuming the worst-case scenario of the U.S. government eventually defaulting on its own debt, what happens to the families, businesses and countries holding those bonds? The lack of interest debt payments would likely cause a global shortage of U.S. dollars, triggering a cascading effect.

But, even if that scenario comes to fruition, history shows us that cryptocurrencies may work as a hedge during periods of uncertainty. For instance, Bitcoin vastly outperformed traditional wealth preservation assets during the U.S.-China trade war in May 2021. Bitcoin gained 47% between May 5 and May 31, 2021, while the Nasdaq Composite shed 8.7%.

As the general public owns over $29 trillion in the U.S. Treasury, they are deemed the lowest risk in existence. Still, the price for each of those government bonds, or the yield traded, will vary depending on the contract maturity. Assuming there’s no counterparty risk for this asset class, the single most important pricing factor is the inflation expectation.

Let’s explore whether Bitcoin’s and Ether’s price will be impacted by the growing demand for U.S. Treasurys.

Bitcoin (BTC) tapped $31,000 for a third time this year on June 25 as the weekly close promised volatility.

BTC price challenges $31,000

Data from Cointelegraph Markets Pro and TradingView showed BTC price movements focusing on yearly highs.

BTC price remained strong over the weekend as attention focused on geopolitical events in Russia and surrounding states.

With tensions lessening on the day, curiosity over markets’ reactions at the June 26 open remained, with the weekly candle close — already a classic source of volatility — coming first.

In a recent analysis, popular trader Rekt Capital put the “most bullish scenario” for the weekly close above the pivotal $30,000 mark.