Yesterday saw the price of bitcoin – the number one cryptocurrency by market cap – jump all the way into the $7,500 range. The currency has added more than $400 to its price in just 24 hours. What happened suddenly, and why is bitcoin deciding to return to its old bullish ways?
Bitcoin Is On a Roll
This is great news for analysts – many of whom have been predicting a solid rise in the bitcoin price over the past few weeks – and for traders, who are seeing the bullish ways of their industry fly like they never did before. Of course, bitcoin is nowhere near the $10,000+ position that it experienced in mid-February. There’s still room for growth, but yesterday’s jump is a massive move in the right direction.
Denis Vinokourov – a market analyst – explains in a statement:
A combination of positive network fundamentals in the form of mining difficulty adjustment and a strong showing by the hash rate since correcting lower in March, together with technical price formation above 50 DMA and aggressive stop loss hunting through $7,500 sent bitcoin soaring all the way to the $7,800 level… Futures contracts trading at a premium to spot prices (known as contango) supports the notions of further upside.
One of the big things that analysts claim to be happening is that traders are really moving in anticipation of the upcoming halving, which is slated to occur in the next few weeks. The big event that’s really been touted for nearly a year is about to arrive, and thus it looks like many people are simply trying to get in on the action as they anticipate huge gains in the coming months.
Many analysts have stated that the halving will bring about bullish activity, and that bitcoin could incur a spike so massive it will bring it to its all-time high once again. It could be that bitcoin is rising because more people are buying; they’re looking to get involved now on the hope that they can potentially garner huge gains in the future once the halving is complete.
Don’t Get Too Cocky
Kiana Danial – CEO of Invest Diva – explained that she believes bitcoin will also turn bullish in the coming weeks, though she put a technical spin on her recent report. She states:
Bitcoin has just broken above the daily Ichimoku cloud, with the future cloud turned bullish… We could see a temporary pullback in the coming days as it has already hit the resistance level of $7,746 which falls on the 38 percent Fibonacci retracement level. From there, as the Ichimoku cloud continues to act as a support, we could see further gains above $8,000 towards the end of the month.
Some – such as Joe DiPasquale of Bit Bull Capital – believe we may see a pullback to $7,200 before BTC incurs any more gains.