Bitcoin’s price rallied dramatically last week as it reversed its retreat! The price is above $28,000 currently. Bitcoin breached above the Fibonacci 100 and then went up to breach above Fibonacci 161.8 resistance! The RSI entered the overbought zone as the price closed above Fibonacci 161.8 resistance and is still there after dipping back down as the price consolidated midway between Fibonacci 161.8 and Fibonacci 261.8 levels! Bulls are firmly in control and doesn’t look bears will muster enough strength to reverse the current drive of the price up as it moves to test the Fibonacci 261.8 support this week.
Equity markets advanced last week after US and Swiss authorities moved to protect depositors and arrange liquidity package deals for insolvent banks such as the SVB, First Republic Bank and Credit Suisse Group. Financial markets are edging up currently while investors are uncertain what will be Federal Reserve’s move this Wednesday - it is not clear whether policymakers will continue rate hikes in light of recent major bank insolvencies. Meanwhile Morgan Stanley (MS) analysts say Bitcoin is trading as a speculative asset rather than as a currency, high ranked former US official claims US government uses crisis to choke off crypto access to banks and a Signature Bank board member says US “regulators wanted to send a very strong anti-crypto message” as they took it over.
As Bitcoin rose almost 20% last Monday after the Federal Reserve and the Treasury Department said they would support the banking sector, MS analysts say Bitcoin price is supported by “USD bank liquidity, making it trade as a speculative asset rather than a currency.” As such it is natural that Bitcoin price rallies as an alternative asset while concerns mount about traditional banks following the forced closures in the US.
Brian Brooks, the former acting head of the US Office of the Comptroller of the Currency (OCC), said last Wednesday "it`s pretty clear there has been a decision across the bank regulatory agencies in this [Biden] administration that crypto is inherently risky and needs to be extricated from the banking system." He made this comment after the Silvergate Bank, the Silicon Valley Bank (SVB) and the Signature Bank were closed, all of which had some crypto clients.
On March 12 US regulators announced that Signature bank was being taken over to protect its depositors and the stability of the US financial system. Earlier On Friday Signature Bank customers withdrew more than $10 billion in deposits following the sudden collapse of Silicon Valley Bank. The deposit exodus had slowed by Sunday, board member and former US Representative Barney Frank said, and executives believed they had stabilized the situation. The bank created a 24/7 payments network for crypto clients and had $16.5 billion in deposits from digital-asset-related customers. “I think part of what happened was that regulators wanted to send a very strong anti-crypto message,” Barney Frank said.