3 Reasons Why Bitcoin and Gold Prices Are Going Up

Bitcoin and gold prices are picking up upside momentum amid fresh tailwinds and easing market selloffs. Investors and whales are buying the dip since BTC dropped to $60,000, but experts caution about potential liquidations due to major US macroeconomic events this week.

Bitcoin and Gold Prices Rise After Prime Minister Sanae Takaichi’s Win

Japan’s Nikkei 225 Index surges over 5% on Monday after Prime Minister Sanae Takaichi’s Liberal Democratic Party (LDP) secured a two-thirds supermajority in a snap election. This is the first time since World War II that a Japanese political party has won more than two-thirds of the seats, The NYT reported.

The yen weakens against the US dollar following PM Takaichi’s landslide election victory. USD/Yen dropped 0.38% to 156.62, easing Yen carry trade unwind risks. Meanwhile, the US dollar index (DXY) also slipped lower to 97.5 ahead of this week’s Non-farm payrolls and CPI inflation data.

Gold prices rose above $5000 and Bitcoin price jumps reclaimed $72,000 after PM Sanae Takaichi’s LDP party won.

Coinbase Premium Index Rebounds

Bitcoin price jumped after a tech-driven broader market pullback due to fresh AI investments gradually subsiding. Meanwhile, President Donald Trump reiterates his 100,000 target for the Dow Jones Industrial Average, prompting US stock market futures to open higher today.

The broader positive sentiment caused the Coinbase Premium Index to make a sharp vertical rebound. This marks the first rise after nearly 2 months, indicating spot buying by US investors and whales.

Meanwhile, markets are closely watching any signs of President Trump’s expectations from his Fed Chair pick Kevin Warsh. Recently, Trump hinted at discussions to lower interest rates, which could push gold higher.

10x Research highlighted $73,000 as the key level to watch. The levels capped prices for nearly five months in 2024 before the post-election rally pushed the market decisively higher. At present, positioning dynamics suggest traders remain focused on deleveraging and unwinding positions rather than preparing for a sudden rally.

Bitcoin Mining Difficulty Drops

Bitcoin mining difficulty fell more than 11% to 125.86 trillion. This marks the largest negative adjustment to difficulty since China’s 2021 mining ban. It’s also the 10th biggest drop in BTC’s history.

Notably, miners sold BTC amid Bitcoin price crash to avoid capitulation. Marathon Digital sold 1,318 BTC worth $86.89 million to crypto exchanges.

The difficulty drop gives remaining miners some temporary relief, but whether that actually helps depends on BTC price action and crypto market sentiment this week.

BTC pared earlier gains and wavers near $71,822. The 24-hour low and high are $69,041 and $72,206, respectively. Trading volume has decreased by 28% over the last 24 hours.