The price of bitcoin climbed more than 6% on Monday, hitting its highest level in a month.
Bitcoin rose to as much as $44,500, according to Coin Metrics, its highest level since Jan. 5. Back then, it hit a high of $47,013. As of 2:56 p.m. ET, bitcoin traded at $44,409.
Those moves built on a sharp pop on Friday, following the release of better-than-expected U.S. jobs data. Many investors saw the data as further encouragement for the Federal Reserve to begin hiking its benchmark interest rate this year, beginning next month, and Treasury yields rose.
Economic stories have been pressuring bitcoin more than ever before recently, as new institutional investors treat it like a risk asset. However, there’s still not consensus on how best to value bitcoin.
The digital currency has also been following equity prices higher, with the major stock indexes posting their biggest weekly gains of 2022, while bitcoin rose.
However, experts aren’t sold on this bounce just yet, especially after bitcoin fell below the $40,000 level twice last month. The digital currency is also well below its all-time high reached last year above $60,000.
“Maybe it is just that — a bounce,” said Noelle Acheson, head of market insights at Genesis.
Acheson said open interest in bitcoin futures has ticked up again, which shows that traders are again taking an opinion. However, bitcoin perpetual futures funding rates are hovering around zero, which signals uncertainty, she said.
“Uncertainty has been the name of the day, we’ve been seeing that in the funding rate,” or the cost of holding long positions in the perpetual futures, Acheson said.
She added that if investors were taking short positions, the funding rate would be more negative and there would be a faster uptick in some of the open interest.
“Uncertainty is what we are mainly seeing and anyone would be kind of crazy, especially given the volatility in the crypto market, to take a hefty short position unless there was some conviction,” she said.
Meanwhile, Katie Stockton of Fairlead Strategies said bitcoin is testing its 50-day moving average after a strong oversold bounce left important weekly support, at $37,361, intact.
“If I wasn’t cautious right now about the equity market, and risk assets generally, I’d be a short-term buyer of the setup,” she said. “However, we need to view it within the context of the downturn in the long-term indicators, which tells us to be noncommittal to longs.