Bitcoin surged to its highest level this month, posts first weekly gain since August

Bitcoin has broken its four-week streak of price declines, marking its first weekly gain since August. The largest cryptocurrency by market value has seen an increase of approximately 2.5% since the previous Saturday, reaching a price of around $26,458.

As of the time of this writing, Bitcoin is trading at $26,468, and market enthusiasts are setting their sights on the $27,000 threshold.

This surge in Bitcoin’s price takes it to its highest level this month, alleviating concerns that a potential September downturn could impact its impressive year-to-date performance.

However, it’s worth noting that formidable resistance is emerging for Bitcoin. The Binance order book reflects a strong sell wall, signifying a significant level of resistance.

Nonetheless, there is strong buying interest at the $26,000 mark. Notably, Bitcoin has shown remarkable resilience, even in the face of higher-than-expected US inflation data released this week.

Market sentiment rebounded as the US Consumer Price Index (CPI) data revealed a 0.6% increase in August, primarily attributed to rising gasoline prices, which accounted for more than half of the overall increase.

Despite this uptick in inflation data, market bulls anticipate that the Federal Reserve’s hawkish narrative will be watered down. The central bank is expected to maintain interest rates at their current level during its policy meeting next week.

Data from CoinGecko indicates that Bitcoin’s current market capitalization stands at over $516 billion, with a 24-hour trading volume of approximately $11.3 billion, suggesting an increase in liquidity.

Recalling recent events, the cryptocurrency market began the past week with significant losses, dropping below the $25,000 mark for the first time since mid-June. This decline was prompted by concerns that the insolvent crypto exchange FTX would soon liquidate all its digital assets, including more than $500 million worth of Bitcoin.

Price actions aligned with this broader narrative, as Bitcoin broke through the $25,500 resistance level, coinciding with the market becoming aware of BlackRock’s Bitcoin ETF filing in June.

At present, Bitcoin is in the process of converting the $26,000 resistance level into support. Over the past week, every attempt to breach this level resulted in strong selling pressure.

The potential for Bitcoin to maintain a position above $26,000 throughout the weekend is seen as a positive sign, at least in the short term.

This positive momentum in Bitcoin has also had a ripple effect on the altcoin market. Altcoins like BNB, Solana, Tezos, and GMX have all experienced substantial gains across the market spectrum.

The recent rally in altcoins follows a period in which traders sold off these tokens due to concerns that the insolvent exchange FTX would gain bankruptcy court approval to sell off assets from its extensive crypto holdings, valued at billions of dollars.

This rally has left those who placed leveraged bearish bets on altcoins like SOL (Solana) exposed to the risk of liquidation. When exchanges liquidate positions due to the market moving against the trader’s position, it results in a lack of margin and the trader’s inability to provide additional margin.

Forced liquidation of sell orders has also added upward pressure on SOL’s price, allowing it to break the $19 resistance level.

Positive developments within the cryptocurrency space this week have further fueled the bullish sentiment. The news of asset management giant Franklin Templeton entering the race to list a Bitcoin spot exchange-traded fund (ETF) and global lending bank Deutsche Bank’s plans to expand its involvement in digital asset custody and tokenization have provided additional support to the rising prices in the crypto market.