Bitcoin surges above $78k amid ceasefire extension and liquidity boost

Key takeaways

  • Bitcoin price rallies higher, trading above $78,000 on Wednesday after surging nearly 6% so far this week.
  • US-listed spot ETF recorded a mild inflow of $11.84 million on Tuesday amid uncertainty over US-Iran peace talks.

Bitcoin (BTC) extended its gains on Wednesday, trading above $78,000 after a significant 6% surge this week. BTC showed relatively muted institutional demand on Tuesday, with Bitcoin spot Exchange Traded Funds (ETFs) adding $11 million in inflows.

Bitcoin’s price was buoyed by both geopolitical developments and the US Treasury’s buyback plan, which could inject additional liquidity into markets and further support Bitcoin’s price momentum.

Ceasefire extension pushes BTC’s price higher

Bitcoin’s positive momentum was fueled by the extension of the two-week ceasefire announced by US President Donald Trump late Tuesday. The ceasefire, which was set to expire on April 22, was extended upon Pakistan’s request until Washington receives a unified proposal from Tehran.

While Trump emphasized that the US blockade of Iranian seaports would remain in place, the ceasefire extension triggered a broad risk rally, driving Bitcoin to its highest price since February 3, reaching $78,452.

Market liquidity is expected to receive a significant boost this week, as the US Treasury is poised to buy back $15 billion of its own debt—matching the largest buyback in history. This move could provide fresh liquidity to the markets, creating favorable conditions for Bitcoin. As a liquidity-driven asset, Bitcoin could benefit from the influx of excess capital, which often flows into risk assets and alternative stores of value.

However, Bitcoin spot ETFs recorded a modest inflow of $11.84 million on Tuesday, down from $238.37 million the day before. This cautious approach reflects investor uncertainty surrounding the ongoing US-Iran peace talks. However, if ETF inflows continue to increase, Bitcoin could see further upside potential.

Bitcoin price outlook: Bullish bias remains

The BTC/USD 4-hour chart remains bullish in the near term as Bitcoin is trading above both the 50-day and 100-day Exponential Moving Averages (EMAs) at $72,345 and $75,368, respectively.

The Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) remain constructive, suggesting that buyers are in control.

Resistance levels lie at the 50% Fibonacci retracement near $78,962, followed by the psychological $80,000 level and the 200-day EMA at $82,769.

On the downside, initial support is expected around the prior channel top at $75,680, with further protection from the 100-day EMA at $75,368 and the 38.2% Fibonacci level at $74,487. The 50-day EMA at $72,345 and the lower channel boundary near $62,950 provide deeper support.


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