First Republic Bank dives another 20% with Bitcoin ‘ready for $40K’
2023.04.26 11:28
Bitcoin (BTC) tagged $30,000 into the April 26 Wall Street open as bulls gained further momentum from United States banking woes.
BTC/USD 1-day candle chart (Bitstamp). Source: TradingView
Hayes: “Uncertainty” driving BTC price, gold
Data from Cointelegraph Markets Pro and TradingView followed as it briefly reclaimed the psychological line in the sand, capping 11% gains versus its local lows from April 24.
The pair continued to respond positively to the rapidly evolving next chapter of the U.S. banking crisis. This centered around First Republic Bank, which revealed a $100-billion reduction in deposits this week.
The U.S. government was reportedly uninterested in intervening on the day, according to a source cited by CNBC, as the bank’s stock, FRC, opened down another 22% before being halted for volatility. Weekly stock price losses thus totaled over 50%.
Responding, Arthur Hayes, former CEO of crypto derivatives exchange BitMEX, smelled blood.
If the government were to refuse a bailout of First Republic, he argued, it could set off a dangerous chain reaction of insolvencies.
“But if FRC fails, and depositors take an L. Then every other bank with the same issues, will go under shortly thereafter. The entire US banking system suffers from the same issues,” part of a Twitter thread read.
Hayes concluded that both Bitcoin and gold were chiefly benefitting from the lack of clarity and associated cold feet surrounding the bank’s fate and lawmakers’ next steps.
“This uncertainty is what is driving outside money like Gold and BTC higher,” he stated.
First Republic Bank (FRC) 1-day candle chart. Source: TradingView
$40,000 Bitcoin price incoming?
Bitcoin traders and analysts thus stayed confident about the overall uptrend continuing, regardless of any temporary consolidatory moves around the $30,000 mark.
Related: Bitcoin touches $30K as BTC bulls well-positioned for weekly $3.2 billion options expiry
“The crucial breaker was $27,800, not $28,800,” Michaël van de Poppe, founder and CEO of trading firm Eight, reflected.
“We’re ready for $40,000.”
Daan Crypto Trades drew comparisons between the current rebound and the prior breakdown to monthly lows.
“Sweeping the highs in quick succession. Similar price action as we saw on the way down where we had about a dozen of these before price properly broke down,” he summarized.
Others, including popular trader Jelle and Byzantine General, forecast a return to rangebound BTC price action at $30,000.
“OI got properly wiped here. About $500 mil obliterated,” the latter noted about derivatives markets’ reaction to the latest gains.
“So that prolly also means that this mini rally is about done, consolidation next.”
BTC/USDT perpetual futures data. Source: Byzantine General/Twitter
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
