Bitcoin has surged past the $71,000 mark, extending a rally that began after the US Treasury announced an expansion of its bond buyback program. The move has injected fresh optimism into the broader cryptocurrency market, with traders now eyeing key technical levels that could define the next phase of the uptrend.
Treasury buyback expansion fuels risk appetite
The US Treasury said it will at least double the maximum size of its liquidity-support buybacks for longer-dated nominal securities, raising the cap from $2 billion to $4 billion per operation. By increasing purchases of longer-term bonds, including those in the 10- to 30-year range, the Treasury aims to support market liquidity and ease upward pressure on yields.
Lower long-term yields tend to improve financial conditions, encouraging investors to rotate into riskier assets such as stocks and cryptocurrencies. While the move is a liquidity-management measure rather than a conventional quantitative easing program, it has nonetheless provided a tailwind for digital assets.
Bitcoin's technical breakout
On the 4-hour chart, Bitcoin has turned bullish after reclaiming several key levels. The cryptocurrency is trading around $71,228, up 10.9% in the last 24 hours. It sits comfortably above the 50-day exponential moving average (EMA) at $64,766 and has also reclaimed the 23.6% Fibonacci retracement at $63,711, measured from the decline between the $82,850 swing high and the $57,800 low.
The price has surpassed the 50% Fibonacci retracement at $70,325, which was the first major resistance. The next hurdle is the 200-day EMA at $71,941, a level that could determine whether this recovery evolves into a sustained rally. A decisive daily close above that would strengthen the bullish structure and open the door to the 78.6% Fibonacci retracement at $77,489. Beyond that, the previous swing high of $82,850 comes back into focus.
For the bullish scenario to hold, Bitcoin must convert the resistance zone between $70,325 and $71,941 into support. If buyers manage that, the path toward higher targets becomes clearer.
Indicators signal strength but also caution
Technical indicators support the bullish outlook, though they also suggest the rally may be getting stretched. The Relative Strength Index (RSI) is near 72, placing it in overbought territory. That reflects powerful buying momentum but also raises the risk of profit-taking or a short-term consolidation.
The Moving Average Convergence Divergence (MACD) remains well above both its signal and zero lines, with an expanding positive histogram that reinforces the view that bullish momentum is building. Together, these indicators suggest buyers are in control, but traders should be alert to potential volatility around the $70,000 and $71,941 resistance levels.
What could halt the rally?
If Bitcoin fails to clear the nearby resistance zone, the 50-day EMA at approximately $64,766 would provide the first significant support. Buyers could defend that level to preserve the latest upward leg. A deeper correction would expose the 23.6% Fibonacci retracement at $63,711, with an ascending trendline near $62,766 offering additional support.
A decisive break beneath that trendline would weaken the bullish outlook and raise the risk of a broader retracement. For now, the market's focus remains on whether Bitcoin can sustain its momentum above $71,000 and eventually challenge the $77,489 level.
As the crypto market strengthens, other assets are also showing breakout potential. For instance, BNB is eyeing a breakout as derivatives data turns bullish, while XRP is nearing $1.10 on ETF inflows and tokenized fund momentum. Meanwhile, gold is holding near a two-month high as upcoming PPI data could spark further gains.
This article is for informational purposes only and does not constitute financial advice.
