Bitcoin BTC hits record high soars over 106,000 three things to know

Bitcoin (BTC), the world’s largest cryptocurrency by market capitalisation, surged to an all-time high of over $106,000 on Monday.

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The rally came after US President-elect Donald Trump suggested creating a Bitcoin strategic reserve, similar to the country’s oil reserve. This proposal sparked optimism amongst crypto enthusiasts, sending Bitcoin’s value soaring and strengthening its position, now holding 56.1% of the total cryptocurrency market share.

TRUMP’S SUPPORT BOOSTS INVESTOR SENTIMENT

The incoming Trump administration is expected to be more favourable towards cryptocurrencies than the Biden White House, further fuelling investor confidence. Trump’s idea of a national Bitcoin reserve has led to widespread speculation about the future of Bitcoin as a store of value.

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Additionally, including MicroStrategy in the Nasdaq 100 index, a company with significant Bitcoin holdings, further fuelled the enthusiasm. As a result, investor sentiment has shifted positively, driving Bitcoin’s meteoric rise.

IMPACT ON OTHER CRYPTOCURRENCIES

Bitcoin’s impressive rise had a ripple effect on other cryptocurrencies. Ethereum, its closest competitor, rose by 1.86%, over the previous day, trading at $3,962.17 at the time of writing. Other major altcoins, such as Solana, Cardano, Avalanche, and Toncoin also saw gains over the past 24 hours, climbing by 1.38%, 1.18%, 1.74%, and 2.44%, respectively.

Memecoins like Dogecoin and Shiba Inu surged by 1.64% and 0.54%, respectively, over the last 24 hours.

MARKET OUTLOOK: STRONG BULLISH SENTIMENT

Bitcoin’s record-high performance has sparked optimism for continued bullish momentum. Avinash Shekhar, Co-Founder & CEO of Pi42, said, “Bitcoin rocketed to yet another high of $106,533, fuelled by a lot of speculation about the impending establishment of a national reserve of Bitcoin, which has been backed by President-elect Donald Trump. Optimism for bullish momentum remains firm as the market awaits a 25-basis point cut by the Federal Reserve, triggering high overtures in the market.”

He added that in the derivatives market, open interest in Bitcoin futures and options had hit record highs, indicative of an overwhelmingly bullish sentiment. The market can see short-term consolidations before a new bull run as selling volumes can outpace buying volumes.

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“Resistance at $106,533 and liquidity clusters close to $100,000 may lead to short-term profit-taking. Nonetheless, due to strong institutional interest and strong buying momentum, Bitcoin looks to have targets in the range of $108,000 to $110,000,” Shekhar added.