Bitcoin has just reached its highest level since January 4th, resulting in a weekly close above $45,500 for the first time in 2022. The move is a bullish indicator because BTC has broken through the $44,500 resistance level, which has already been rejected three times this year.
As we have witnessed repeated higher lows all year, the breakout may corroborate the falling wedge pattern that can be observed on the daily chart. While technical analysis can provide useful short-term trading signals, it is not always a trustworthy indicator for long-term investing. Technical analysis is not a precise science. To obtain a whole picture of why Bitcoin might be exploding, we need to look at the larger socioeconomic landscape.
The year has seen a lot of good news for cryptocurrency, which has been in the news all around the world, from donations to help Ukraine in the face of Russian aggression to positive attitude from European and American legislators.
Many people assumed that we had exited the era of crypto prospecting and entered the era of crypto acceptance and blockchain infiltration into the mainstream. While Bitcoin is currently down 30% from all-time highs, it has fared well in 2022, with relatively minimal volatility by its own norms. Its correlation to the S&P500 recently reached a 17-month high, demonstrating how stable it has been.
