Amid the fall of bitcoin prices below $90,000, the crypto market unexpectedly surged following U.S. President Donald Trump's announcement about creating a digital asset strategic reserve.
Impact of Trump's Announcements on the Market
Donald Trump's Friday announcement regarding digital assets sparked an unexpected change in market sentiment. Despite Bitcoin's monthly candle closing at $84,299, its weekly closing ended the week at $94,222, forming a doji. A known analyst expresses caution regarding the potential short-lived impact of this momentum.
Parallels with the 'Xi-Pump'
In 2019, after Chinese President Xi Jinping's statement on blockchain support, the market experienced a sharp rise. However, subsequent Chinese regulatory crackdowns led to price declines. Analyst Cold Blooded Shiller sees similarities between market dynamics then and now, noting the risk of repeating past mistakes.
Bitcoin Distribution and Accumulation
Glassnode analysts reported that despite the recent BTC price surge, distribution continues. The cost of bitcoin for short-term holders fell below $92,700, putting them in a vulnerable position. A concerning signal remains the lack of an accumulation trend, which hasn't been observed for 58 consecutive days.
The influence of political statements on the cryptocurrency market is often short-lived and accompanied by subsequent corrections. Analysts caution against hasty decisions in such situations, emphasizing the importance of independent analysis for all investors.
