Bitcoin Bounces Back Above $84,000 as Risk Appetite Returns

Sellers of risk assets are taking a breather on Friday, with crypto markets posting sizable gains along with U.S. stocks after a week of lame price action.

Crypto markets are trading substantially higher on Friday, heating up after a week of lackluster price action. Risk sellers also took a step back, allowing U.S. stocks to post sizable gains.

Bitcoin price topped $85,000 at one point during U.S. hours and is now up 4.7% over the past 24 hours, according to CoinDesk data. All cryptos in the CoinDesk 20 Index were higher during the same period, with Chainlink's LINK, Solana's SOL and SUI leading gains.

The crypto price action happened as risk appetite returned to traditional markets as well. The S&P 500 and the tech-heavy Nasdaq indexes were 1.7% and 2.3 up, respectively.

Gold, whose price action trounced that of bitcoin during the selling of the past few weeks, backed down below $3,000 after crossing the level yesterday for the first time in its history. Today's bounce also propelled BTC above its 200-day moving average after dipping below that trendline on Wednesday for the first time since last August’s crypto correction.

The 200-day moving average is a widely-used benchmark for traders and investors to gauge long-term trends for asset prices, often serving as support for prices to bounce in a bull market, while losing the level providing a risk-off or bear market signal.

Closing the day above the moving average, currently at $83,767, would be a win for bulls, who might then be able to spot the worst of the correction as over. Otherwise, confirming the moving average as resistance could foreshadow a deeper pullback.

Well-followed cross-asset trader Bob Loukas noted that bitcoin and stocks have more room to run “at least for a while,” bouncing from oversold levels. “Feels like should be close to end of panic, for now at least, and spend at least a few weeks recovering, and then the market reassess.”