Bitcoin charges $40k barrier as markets rise on hopes of Russia-Ukraine talks

Bitcoin briefly traded at $40,000 before retreating below it on Saturday. Image from freepik
Bitcoin briefly traded at $40,000 before retreating below it on Saturday. Image from freepik

Key Takeaways:

  • Bitcoin prices briefly broke above $40,000 during trading on Saturday after news of possible talks between Ukraine and Russia hit the wire.

NEW DELHI (CoinChapter.com) — News of talks with Ukraine coming out of the Kremlin helped Bitcoin and other cryptos rise on Friday, helping Bitcoin return briefly to $40,000.

Kremlin spokesman Dmitry Peskov that President Vladimir Putin is ready to send a delegation to Minsk. President Putin responded to an offer of talks from his Ukrainian counterpart, President Volodymyr Zelensky.

However, the situation remains unstable, as Russian forces intensified their attacks on Ukraine’s capital in recent days. As such, traders believe the price boost is likely temporary, especially since the Russian president’s comments hinted he was not serious about participating in talks.

Meanwhile, Bitcoin mining firms are expanding their operations in the US despite the token’s price volatility. Keegan Francis, global crypto editor for Finder.com told CoinChapter he believes BTC miners are expanding in the US as BTC mining is cheaper there compared to Bitcoin prices.

Also Read: Bitcoin falls below $35K, gold rallies as Russian army invades Ukraine.

He also noted that energy firms find crypto mining operations to be a win-win situation. Mr. Francis explained that often, due to low demand during certain periods of the day, electricity generation becomes unprofitable. He said,

Miners are a buyer of last resort for generated electricity that there is no demand for on the grid. Miners can mine bitcoin profitably and energy suppliers can earn money on energy that would have otherwise been wasted.

Francis believes Bitcoin will reclaim its $60,000 price level based on the current geopolitical backdrop.

Ben Gagnon, Chief Mining Officer at Bitfarms, also noted the impact of energy costs on miners’ decisions. He explained to CoinChapter that BTC mining is, in essence, the monetization of energy. Mr. Gagnon said

[The US] is the second largest electricity producer globally after China and has abundant and underutilized energy reserves and infrastructure. It also has the largest and most robust capital and financial markets to grow the business domestically. Strategically, this access to capital and underutilized energy makes the US one of the most competitive jurisdiction in the world to mine Bitcoin.

Strong Resistance For BTC near $40,000

Due to Russia’s invasion of Ukraine, the resulting geopolitical scenario left global markets in flux as investors remained averse. Nevertheless, the S&P 500 rose 2.24% on Feb 24. The ruble also moved higher but remained near its weakest level ever recorded.

Bitcoin price movement over the past seven days. Source: CoinMarketCap.com
Bitcoin price movement over the past seven days. Source: CoinMarketCap.com

Meanwhile, Bitcoin prices seem to have recovered the losses incurred over the last seven days, as BTC prices traded near $40,000. BTC plunged below $35,000 on Feb 24 before an aggressive buying spree from bulls helped Bitcoin recover as it ended the day with 2.7% gains.

The pioneer crypto’s 26-day exponential moving average (white wave) and the 50-day moving average (purple wave) have formed a resistance confluence near the $40,000 price level. It may be the reason why BTC failed to hold above $40,000.

BTCUSD on the daily charts with RSI. Source: Tradingview.com
BTCUSD on the daily charts with RSI. Source: Tradingview.com

However, if Bitcoin flips the confluence, prices would move to $41,022. A sustained buying spree would see BTC challenge resistance near $43,080. Finally, BTC’s 100-day MA (yellow wave) acts as resistance near the $44,500 price level.

Also Read: BTC struggles below 38K, as gold rally amid Ukraine tension jeopardizes Bitcoin’s safe-haven status.

The relative strength index for Bitcoin is neutral, clocking 45.74 on the daily charts.

Bitcoin MACD Showing Hint Of Bullishness

Trend-based momentum oscillator MACD remains bearish for Bitcoin, charting negative bars on the MACD histogram.

However, bars on the histogram are contracting, indicating that the MACD line (difference between 12-day and 26-day EMA) is moving up towards the MACD signal line (9-day EMA of MACD). Contracting bars indicate a strengthening of bullishness in the asset’s momentum.

BTCUSD on the daily charts with MACD. Source: Tradingview.com
BTCUSD on the daily charts with MACD. Source: Tradingview.com

However, if prices fail to move above immediate resistance, BTC would likely fall back to support near the $38,430. If bears move in to sell, the pressure would further pull down prices to support near $36,600. Additionally, $35,000 remains a key support level for Bitcoin.

At the time of writing, BTC was trading at $38,944, down 0.74% on the day.

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Bitcoin, Bitcoin charges $40k barrier as markets rise on hopes of Russia-Ukraine talks

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