Bitcoin’s price surged to $87,400 on April 21, recovering from prior drops due to a sell-off in the US dollar and rising gold prices. Key factors included comments regarding potential changes in the Federal Reserve leadership and renewed trade policy anxieties. Analysts highlight technical breakouts, with a target near $94,000 and caution about the validity of the rally amidst low trading volume over the weekend.
Bitcoin’s price experienced a significant surge, reaching $87,400 on April 21, marking its highest point since March 29. This rally saw the cryptocurrency gain over $3,000 within a single day, effectively reversing a considerable part of its losses during April. Although a 4% increase is customary for such a volatile asset, this rise is perceived with greater importance due to the context surrounding it.
The immediate cause for Bitcoin’s increase can be linked to a sell-off in the US dollar following comments from National Economic Council Director Kevin Hassett. He indicated that President Trump plans to replace Federal Reserve Chair Jerome Powell, causing the dollar index (DXY) to fall to 98.182. This decline has driven capital towards traditional safe havens like gold, which rose to $3,385 per ounce, reflecting a 28% increase for the year.
Observers have noted the disconnect between Bitcoin and standard risk assets. Financial writer Mel Mattison highlighted that Bitcoin appears to be detaching from its previous correlation with tech stocks, suggesting a possible future alignment with gold’s performance. Apollo founder Thomas Fahrer echoed this sentiment, noting that Bitcoin’s rise amidst declining stock futures hints at its emerging role as an alternative financial system.
The Kobeissi Letter has drawn attention to the simultaneous rise of gold and Bitcoin, both indicators of a weak US dollar and growing uncertainty. Gold, achieving its 55th all-time high in a year, alongside Bitcoin’s rise, is seen as a reaction to President Trump’s recent publication of a list targeting unfair economic practices.
Concerns regarding trade policy have compounded the market’s anxieties, following a lack of significant trade developments post-Easter weekend. Although Trump’s ninety-day pause on tariffs has 79 days left, skepticism around forthcoming trade deals remains prevalent. FOX Business reported that a Wall Street executive linked to the Trump White House suggested a significant trade deal with Japan may be imminent, although negotiations are still ongoing.
From a technical viewpoint, analysts have indicated a structural breakout on the Bitcoin chart, with Trader Scott Melker noting that Bitcoin is breaking through descending resistance from its all-time high. The key resistance level to monitor is $88,804, as breaking this could signify a shift from lower highs to a more constructive upward trend. Meanwhile, at the top of the current rally, the $94,000 level is observed as a crucial target based on Fibonacci retracement metrics, determining the potential direction of future price movements.
Crypto analyst IncomeSharks cautioned about celebrating the recent breakout, emphasising that low trading volumes during the weekend are not ideal for confirming bullish momentum. The real test will come when stocks are open; if they perform poorly while Bitcoin remains strong, bullish sentiment could follow. At the time of reporting, Bitcoin was trading around $87,509.
