- Bitcoin has formed an inverted head and shoulders pattern.
- The US government avoided a major shutdown in a surprise move.
- LRC, Bad Idea, DOGE, and SOL have pumped to the highest point in weeks.
The cryptocurrency market started the final quarter of the month well as investors cheered the decision by the US Congress to avoid a major government shutdown. Bitcoin surged above the key resistance point at $28,000 while the total market cap of all coins soared to over $1.8 trillion. Other tokens like Loopring, Bad Idea, Dogecoin, and Solana continued pumping.
Loopring (LRC) price pumped during the weekend and surged to a high of $0.19, the highest point since September 9th. It has jumped by more than 13% from the lowest level in September. Bad Idea, the relatively new meme coin, has soared to $0.000000050, ~50% above its September low while Dogecoin price has surged to its September 9th high. Solana price has to August 15th high, ~40% above its September low.
These altcoins surged as investors cheered the surprise decision by Kevin McCarthy, the house speaker to pass a short-term government spending bill. The bipartisan bill also passed the Senate, avoiding a costly government shutdown. As a result, the US dollar index (DXY) pulled back as risks eased while the Dow Jones, S&P 500, and Russell 2000 futures pointed upwards.
Bitcoin has also formed an inverted head and shoulders pattern, which is usually a bullish sign. It has already passed the neckline of this pattern, pointing to a further upside to the next resistance point at $30,000. Most importantly, Bitcoin has done well after it crashed below $25,000 in the first week of September.
Another reason for the crypto rally is that investors believe that the Securities and Exchange Commission (SEC) will be under pressure to approve a spot Bitcoin ETF this quarter. For one, the current slate of applicants include companies like Blackrock, Invesco, Franklin Templeton, and Fidelity which have decades of experience in the industry.
Also, the SEC will be keen to avoid another embarrassing lawsuit from one or more companies. It recently lost a major lawsuit from Grayscale, which runs the biggest fund in the industry with over $15 billion in assets. Also, the SEC lost a lawsuit against Ripple Labs.
Still, there are risks to the ongoing Loopring, Bad Idea, and Solana price pumps. For one, inflation is still a a major issue, with the headline consumer price index (CPI) jumping to 3.7% in August. America’s gasoline prices are approaching $4 as the price of crude oil jumps. The UAW strikeis continuing while the Fed has committed to delivering another rate hike.
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