Bitcoin surged above $79,000 on Wednesday, reaching its highest level since early February as a long-awaited breakout attempt gained momentum.
The largest crypto rose 4.5% in the last 24 hours, outpacing major altcoins ether (ETH), BNB. Solana (SOL) and XRP higher. The broader CoinDesk 20 index rose 3.5%.
Crypto-related stocks also rose. Strategy (MSTR), the largest BTC holding company, jumped 10%, while stablecoin issuer Circle Internet (CRCL) gained 9% and crypto exchange Coinbase (COIN) rose 6%. Bitcoin miners MARA Holdings (MARA) and Riot Platforms (RIOT) added 6-7%.
The broader macroeconomic context has also become supportive. The S&P 500 rose 0.9% and the Nasdaq rose 1.3% to record highs, extending the risk-on environment.
The gains follow U.S. President Donald Trump’s statement Tuesday evening that he would extend the ceasefire in Iran while maintaining a naval blockade of the Strait of Hormuz. Yet uncertainty around peace talks remains.
“BTC’s near-term direction remains heavily dependent on macro and geopolitical developments,” said Paul Howard, senior director at Wincent. He highlighted $72,000 as key support, with upside potentially capped near $80,000 as traders take profits.
Bitcoin Short Squeeze Potential
Even if macroeconomic risks remain, positioning on derivatives could fuel the rise.
Perpetual swap traders remain strongly bearish, with seven-day funding rates near three-year lows, noted Vetle Lunde, head of research at K33 Research. At the same time, open interest continues to grow, suggesting that new leverage is entering the market.
“Increasing leverage alongside deeply negative financing suggests that short selling is steadily increasing, increasing both the likelihood and potential magnitude of a short sale,” he wrote.
“We continue to see strong breakout potential for BTC, with concentrated shorts providing ample fuel for an upside,” Lunde added.
The $80,000 zone, however, has additional weight for bitcoin. It aligns with the price realized by the short-term holder – a measure of the average cost basis for new market participants, who tend to be more sensitive to volatility and more likely to sell hard.
For now, BTC is testing this hurdle. A sharp move above this level could signal stronger conviction behind the rally, but failure to hold could lead to renewed selling pressure and profit-taking from shorter-term holders.
