Bitcoin recently shot up past $95,000 after a surprise announcement from President Trump. He announced the formation of a US Crypto Strategic Reserve, including Bitcoin, Ethereum, XRP, Solana, and Cardano. This sparked huge excitement, with many believing it signaled crypto’s official entry into the US financial system. However, not everyone was convinced.
Was it a Political Masterstroke?
The timing of Trump’s announcement is suspicious. The week leading up to it saw a drop in risk assets due to new tariffs and uncertain Ukraine-Russia peace talks. Basically, the markets were tanking. QCP Capital, a crypto investment firm, suggests Trump needed a win to boost his approval ratings – the announcement was a well-timed political move.
Doubts Remain
While the Bitcoin surge was exciting, QCP Capital isn’t buying it. They point out that Bitcoin is still trading near its lowest point in months and market volatility is high. They’re not convinced this is a real breakout.
Déjà Vu: The “Xi Candle”
Seasoned traders are seeing parallels between this rally and the “Xi Candle” of 2019. Back then, Chinese President Xi Jinping’s pro-blockchain announcement caused a massive short squeeze, sending Bitcoin soaring 40% in just two days. However, this was short-lived; China later cracked down on crypto, and Bitcoin’s gains evaporated. The fear is that Trump’s announcement could follow a similar pattern.
What to Watch This Week
Bitcoin’s future depends on several key events:
- Wednesday: The Purchasing Managers’ Index (PMI) data will be released. Weak data could boost Bitcoin (as it might signal interest rate cuts), but strong data could hurt it.
- Friday: The Non-Farm Payrolls (NFP) report, a key employment indicator, will be released. A strong report could be bad for Bitcoin, while a weak one could be good.
- Friday: The White House Crypto Summit could provide more details about the US Crypto Strategic Reserve. Positive news could push Bitcoin higher, while lack of progress could cause a drop.
QCP Capital acknowledges the uncertainty, saying Trump might still have more surprises up his sleeve. Will this rally lead to new all-time highs? Only time will tell. At the time of writing, Bitcoin was trading around $90,352.
