Bitcoin Breaks Out; New All-Time Highs Lift Crypto Sector

Bitcoin is once again breaking out to the upside, with the cryptocurrency futures (/BTC) hitting record highs of 119,450 on Friday. Bulls managed to push through a resistance zone between about 109K to 111K, with the move marking a roughly +58% rally since /BTC’s notable low point in early April when price held the line from a November gap up near 78K.

The move seems to have sent ripples throughout the crypto industry to varying effect. Ether futures (/ETH) also gapped upward about +5.0%, as the smaller cryptocurrency followed suit with /BTC and broke through its own persistent price ceiling near 2,800. Both futures products also saw their respective Relative Strength Index studies (RSI) break through downward trendlines and make new highs, suggesting a bullish shift to momentum. However, both products lost a fair bit of ground from their intraday highs, with /ETH actually falling slightly from its open. It also remains far below its all-time highs of 4,902.80 and so far seems to have topped out at another potential resistance point, which is repeated prior support around 3,060.

Crypto-related stocks had more of a mixed reaction. Coinbase (COIN) made new all-time highs of 395.50, but fell -1.1% on the day. Shares of the crypto exchange are still holding on to an upward price trendline beginning with a low from mid-June, but RSI tells a different story. This study shows bearish divergence, a mismatch between higher closing prices and lower closes on the RSI which signifies that the pace of the uptrend is slowing. The area near 350 is a notable possible support area, representing old highs from December that price for the most part held above after the breakout late last month. 

Meanwhile, Strategy (MSTR), formerly MicroStrategy got a +2.6% boost. The software company focuses on A.I.-powered enterprise analytics, but also reports holding 597,325 bitcoins with a cost-basis of about $70,982, according to Barron’s. Shares narrowly held on to gains above its old highwater mark of 430.35 from early May; but that 430 level also is roughly where price topped out during a volatile period from November to December despite hitting all-time intraday highs of 543. The yearly Volume Profile shows the heaviest trading activity between about 360 to 400, after which trading activity drops off sharply. Thin volume zones can result in fast-moving prices, and that is always worth remembering with bitcoin and the crypto sector. 

Also note that next week holds more potential catalysts for crypto, as the House considers several bills during ‘Crypto Week’, including the GENIUS Act.