Bitcoin Briefly Tops $62,000 as Global Recession Fears Subside

Bitcoin has gained 6% in the past day and climbed past $62,000 for the first time since last week the day after the U.S. initial jobless claims came in lower than expected and calmed fears of a global recession.

At the time of writing, Bitcoin’s price has retraced slightly to around $60,270, up 4.2% on the day according to CoinGecko data. Earlier this morning it surged as high as $62,490.53. The world’s oldest and largest cryptocurrency by market cap has also seen $91 billion traded in the past day, according to Coinglass—which tracks derivatives as well as spot market activity.

It was only Monday when Bitcoin sank as low as $49,781.93, amid fears that financial markets could be headed for a global recession.

The rebound is largely thanks to U.S. initial jobless claims seeing their biggest drop in 11 months yesterday. The Labor Department reported claims for unemployment benefits came in at a seasonally adjusted 233,000 last week after economists polled by Reuters and Dow Jones had been forecasting they would come in at 240,000.

But it’s not all sunshine and up only from here, K33 Research analyst David Zimmerman reminded traders recently.

“The smackdown was a stark reminder that we have lost bullish momentum,” he wrote, adding that Bitcoin and Ethereum are still below their 200-day moving averages. “This does not mean you should stay away from longs, but it does mean you should be more aggressive with profit-taking on longs,” he wrote.

The market chaos at the start of the week was especially painful for traders, wrote Glassnode in its recent Week On-Chain report.
“The sell-off triggered a surge in panic by investors, with around $1.38B in realized losses locked in by market participants,” analysts wrote. “In absolute terms, this is the 13th largest event in history on a USD denominated basis.”

But all that selling created an opportunity for institutions, who analysts have been saying are buying the dip as the Bitcoin price finds its footing.

“The overall mood among institutional investors is that, despite the many short-term crosscurrents, the outlook for the asset class remains very positive in the medium and long terms,” FalconX head of research David Lawant told Decrypt earlier this week.

Sure enough, Bitcoin ETF inflows yesterday were the strongest they’ve been since July 31. On Thursday, August 8 the funds took in $201.5 million, per data from Farside Investors.

That happened on the same day the Grayscale Bitcoin Trust (GBTC) saw outflows of $183 million. But Blackrock’s iShares Bitcoin Trust (IBIT) accounted for $165 million worth of new deposits and Fidelity, ARK Invest, VanEck, and WisdomTree all ended the day in the green.