Bitcoin hits $41,400 with its biggest daily gains since October as altcoins surge

• Bitcoin gained 10 percent in the past day, the most it has gained in a day since the October bull market, to set a new two-week high of over $41,400.
• Ether is up over $3,000, leading an altcoin rally that has seen BNB, Terra, Polkadot, Avalanche, and others gain over 10 percent. 

Bitcoin is finally trading above $41,000 after seeing one of its best days in four months. The top cryptocurrency has led a market rally that has seen Ethereum trade above $3,000, with major altcoins including Binance Coin, Cardano, XRP, Terra and Polkadot all recording over 10 percent in daily gains. Solana, despite suffering from the Wormhole attack is also up over 11 percent in what has been a profitable day for crypto.

At press time, Bitcoin is up over 10 percent and is changing hands at $41,480. The top crypto set an intra-day high at $41,729, the highest it has hit since January 21, two weeks ago. The rise has been marked by a 44 percent rise in trading volume at $30.2 billion, with Binance, Coinbase and FTX seeing the most activity.

The rise now takes Bitcoin’s market cap to $786 billion, with its dominance in the market now standing at 41.3 percent.

On the technical charts, the surge past $40,000 was critical for Bitcoin. The crypto has been stuck in a trendline resistance pattern that stretches all the way back to November when it hit its all-time high. This descending trendline has consistently managed to suppress the price of Bitcoin.

Two previous attempts to break this trendline – one in December at $51,000 and another in mid-January at $41,500 – were both unsuccessful, as the chart below shows.

The gains by BTC come at a time when the stock market has seen a boost following some positive earnings reports from the likes of Amazon and a rise in hirings in the U.S job market.

Matt Maley, the chief strategist at Miller Tabak + Co. commented:

The fact that AMZN’s earnings went the way of AAPL, MSFT and GOOGL — and not the way of FB — has given investors more confidence to reengage with the risk-on trade.

But it’s not yet time to break out the champagne, another analyst warns. Stephan Oulette, the founder of FRNT FInancial, an institutional crypto trading platform, believes that Bitcoin has been too correlated to the stock market and it could once again tumble if major stocks perform dismally in the coming weeks.

As CNF has reported in the past, Bitcoin has ceased being a hedge against inflation with the rise of institutional investors. In recent months, whenever the stock market has crumbled, Bitcoin has crashed with it.

Oulette commented:

In spite of today’s move from a technical perspective, I don’t think we can start saying anything definitive until at least a definitive breakout beyond $40,000 to $41,000.