- Argo Blockchain stock price popped by more than 24% on Tuesday.
- The rally was triggered by Grayscale's victory against the Securities and Exchange Commission.
Argo Blockchain share price rose by more than 24% in New York as Bitcoin mining stocks surged. It rose to a high of $1.27, which was much higher than this week’s low of $0.9566. Other mining stocks like Cipher Mining, Riot Platforms, and Marathon Digital also surged.
Grayscale ruling spurs mining rally
There were two main catalysts that pushed the Argo Blockchain share price sharply higher in New York. The minor news was the relatively weaker US consumer confidence and vacancy data in the United States.
Data by the Conference Board showed that consumer confidence dropped in August as gasoline prices rose. It was the first month of decline in three months. The number of job vacancies in the US dropped to the lowest level since 2021 in July.
Therefore, these numbers mean that the Fed could be forced to pause interest rate hikes in September. In his speech at the Jackson Hole Symposium, Jerome Powell hinted that the Fed has more hikes to implement.
These economic numbers helped trigger a rally in risk assets as the Nasdaq 100 index jumped while the US dollar index (DXY) slipped.
The most important catalyst for the Argo Blockchain share price was the victory by Grayscale. As I wrote here, the company, which is owned by Digital Currency Group, won a major victory against the SEC.
In its decision, the court ruled that Grayscale could transition its multi-billion dollar fund into a spot Bitcoin ETF. This ruling was important for two main reasons. First, it opens the door for the SEC to approve other Bitcoin ETFs by companies like Blackrock and Invesco.
Such a move will lead to a higher demand for Bitcoin, benefiting mining companies like Argo Blockchain, Riot Platforms, and Marathon Digital. These companies also do well when Bitcoin price is rising.
Argo Blockchain share price forecast
The 4H chart shows that the ARBK stock price formed a morning star pattern on Tuesday and then bounced back to the highest level since August 17th. The shares are operating at the 25-period and 50-period moving averages while the Relative Strength Index (RSI) rose above the neutral point of 50. It also retested the upper side of the descending channel.
Therefore, the outlook for the stock will depend on how Bitcoin performs. The most likely scenario is where it loses momentum and retests the important support at $1.0. The bullish outlook will be invalidated if the stock moves above $1.30.
