Here’s What’s Driving a Bitcoin Buying Frenzy Amongst Retail Investors
- On-chain data suggests that retail Bitcoin investors are currently engaged in a buying frenzy
- This comes close on the heels of the crypto’s terrifying plunge from $8,000 to $3,800 – which has since been followed by an unwavering uptrend
- The strength Bitcoin has shown in the face of massive macroeconomic weakness may be bolstering investor sentiment
The capitulatory plunge that Bitcoin took on March 12th was historic, with the cryptocurrency declining from highs of over $8,000 to lows of $3,800 over a matter of mere hours – a day that will now live in crypto infamy as “Black Thursday.”
The price action seen following this selloff, however, seems to illuminate the strength of the digital asset, even leading one analyst to go as far to say that it makes Bitcoin the “most resilient asset in the world.”
This overt resilience may be driving an ongoing buying frenzy that Bitcoin investors are currently engaged in, as data suggests that BTC holders are accumulating at a rapid rate.
According to recent data from blockchain research platform Glassnode, Bitcoin investors are now accumulating the cryptocurrency at an unprecedented rate.
While looking towards their “Hodler Net Position Change” indicator, it appears that investors are increasing their BTC exposure at the fastest rates seen this year.
“Bitcoin HODLer Net Position Change has been growing daily since the end of March and is now hitting yearly highs. Long term investors are increasing their positions – and they’re accumulating more BTC each day,” they noted while pointing to the below chart.
This seems to indicate that investors are growing increasingly optimistic on the cryptocurrency – a phenomenon that may be rooted in the intense uptrend Bitcoin has seen in the time since this recent decline.
Bitcoin has seen a notable uptrend in the time following this decline, rising to post-crash highs today of $7,800.
The reaction to this decline against a backdrop of global economic turbulence has led Luke Martin – a respected cryptocurrency analyst – to explain that this move has confirmed BTC’s status as “the most resilient asset in the world.”
“Take a step back think about how BTC has almost completely recovered from the 50% drop in March. •No limit down or trading halted •No emergency meetings of producers to cut/alter supply •No government pledges to start buying. The most resilient asset in the world,” he said.
This buying frenzy will likely be further perpetuated by the highly bullish price action seen today, which could generate a sense of “fomo” amongst investors.
Featured image from Unplash.
- Bitcoin Breaking this One Level May Send Crypto Market into Full-Out Rally
- Bitcoin Skyrockets To $7700: Almost Fully Recovered From The March 12 Collapse, As Gold, Oil and Global Markets Soar
- Market Wrap: Bitcoin Gains as Futures Dance the Contango
- BTC Pre-Halving Pump in Play as Bitcoin Price Surges Toward $8,000
Bitcoin Breaking this One Level May Send Crypto Market into Full-Out Rally
The entire crypto market saw a notable upswing today that was driven by Bitcoin’s sharp movement up to highs of $7,800 earlier this morning. This has led most major altcoins to push higher, with the aggregated market’s strength continuing to grow.
In the time following this movement, Bitcoin’s price has settled back below $7500 – a critical level that analysts are now closely watching.
How it reacts to this level in the days and weeks ahead could dictate which direction the aggregated crypto market trends next.
The market-wide upswing seen today came about after the benchmark cryptocurrency pushed up to highs of $7,800, leading Ethereum, XRP, and virtually all other major altcoins to also push higher.
Altcoins have formed an incredibly close correlation to Bitcoin in recent times, just slightly outperforming it during uptrends and underperforming it during downtrends.
This correlation means that the fate of the crypto market rests on which direction Bitcoin trends next, and traders could soon gain some clarity as it fast approaches a critical level.
One popular crypto analyst on Twitter spoke about this critical level in a recent tweet, explaining that the $7,500 region has proven to be important on multiple occasions throughout 2019 and 2020.
“Since 2019 a level of upmost importance has been 75xx – Above it: trend has been very bullish. Below it: trend has been very bearish (provided great entries) – Currently testing waters above it, confirming it support would be exciting to say the least,” he noted while referring to the below chart.
How BTC responds to this level is likely to have a major impact on where the aggregated crypto market trends next.
There’s no question that today’s upswing was an overtly bullish occurrence, as it marked continuation of the trend that was incurred when Bitcoin rebounded from March lows of $3,800.
This uptrend may not last long, however, and could soon lead the aggregated crypto market to see a significant decline.
One pseudonymous trader on Twitter recently offered a grim chart that shows the multiple heavy resistance levels that exist just above Bitcoin’s current price level, with a labeled downside target sitting at around $4,700.
If this possibility does unfold in the near-term it will likely lead most major cryptos to similarly see some intense losses, potentially severely underperforming Bitcoin.
Featured image from Unsplash.
Author: Cole Petersen
Bitcoin Skyrockets To $7700: Almost Fully Recovered From The March 12 Collapse, As Gold, Oil and Global Markets Soar
Bitcoin made a serious move in the past few hours as its price soared up to above $7,720 in just a few minutes. Legacy markets followed as the S&P500, the Dow, as well as gold and oil are all trading in the green.
In a few quick hours, Bitcoin’s price marked a massive increase, surging up above $7,700 from about $7,060. The price has since retraced a bit as it’s currently trading around $7500, which is still about 5% on the day.
As it can be seen on the chart, Bitcoin traded around $7,100 for the majority of the time today, but it started moving up and reached a daily high of about $7,738 on Binance. Even though the price was rejected there, it’s still trading at a nice 5% increase on the day. With this latest increase, Bitcoin has almost fully recovered from the crash that took place on March 12th-13th.
Other major altcoins are also trading positively, with Stellar charting an impressive 17% increase at the time of this writing.
Traditional stock and commodity markets are also in the green today as bulls appear to have settled across the board.
At the time of this writing, the S&P 500 is charting an increase of about 1.3% – the same as the Dow Jones Industrial Average (DJI)
Interestingly enough, gold is also up about 1.3% today as it trades at around $1,733 per ounce.
West Texas Intermediate crude oil is also making a recovery. The contracts set to expire in June currently trade around $18, which is 31% more than its price yesterday. Two days ago, the contract marked a 21-year low as it dropped more than 43% to reach $11.57 on the New York Mercantile Exchange. The May contract, on the other hand, traded in the negative for the first time in history.
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Market Wrap: Bitcoin Gains as Futures Dance the Contango
Apr 23, 2020 at 21:38 UTC
Bitcoin futures are showing signs the market is more optimistic on the cryptocurrency. On Thursday, prices for further-dated futures contracts on the Chicago Mercantile Exchange (CME) were higher than near-dated ones. The term structure, known as contango, is usually taken as a bullish signal.
The world’s oldest cryptocurrency popped 10 percent Thursday ahead of April CME futures expiration, from $7,018 to as high as $7,765 on retail-friendly spot exchanges like Coinbase. The CME April contract settled at $7,115 on Thursday while those for May delivery came in $40 higher, indicating a positive outlook.
“Leveraged demand is back with a vengeance today, with the futures term structure shifting back into contango, after a trigger of stops on the break of $7,500 sent bitcoin all the way to the $7,800 level,” said Denis Vinokourov, head of research for cryptocurrency brokerage and exchange Bequant.
Earlier in the week, further-dated contracts were trading at a discount to the spot price, a situation known as “backwardation.” Contango returned Wednesday and for a short period of time Thursday, Kraken futures dated a month out were trading at a 7.3 percent premium on an annualized basis to spot on the Kraken exchange, according to data from Skew metrics.
Long-range bitcoin outlook
Bitcoin’s price is only now approaching where it was just prior to its March 13 crash, when it changed hands as low as $3,867.
“I’m happy for the pop. However, being bitcoin I’m not impressed – we are back at the April 9 level, nothing to see here,” said Henrik Kugelberg, a Sweden-based over-the-counter (OTC) trader.
Other crypto markets
As bitcoin goes up, so do other crypto assets. Ether (ETH) climbed 3.7 percent in the past 24 hours of trading as of 21:10 UTC (5:10 p.m. EDT).
Other digital assets were also in the green for the day. The biggest winners Thursday included stellar (XLM), up an eye-popping 18 percent, cardano (ADA) higher by 16 percent and ethereum classic (ETC) gaining 6 percent. All price changes are as of 21:10 UTC (5:10 p.m. EDT).
Despite recent research towards the contrary, increases in stablecoin issuance are one signal to look towards for today’s bullish activity, says Blockfills’ Van Huis. “We’ve seen a massive increase in stablecoin activity, perhaps indicating fresh money coming into the market which eventually gets distributed into cryptos.”
Oil is roaring back in a big way, jumping 19 percent in trading per barrel as of 21:10 UTC (5:10 p.m. EDT). This is after a historic week saw ‘black gold’ futures prices hit historic negative values Monday.
As for real gold, the yellow metal gained 1 percent – trending downward a bit in Thursday afternoon trading but the safe haven remains in the $1,700 area it crossed Wednesday.
In the United States, the S&P 500 index slipped less than a percent with U.S. Treasury yields relatively flat as a reported 4.4 million fresh jobless claims were reported this week.
The FTSE Eurotop 100 index of largest companies in Europe was up less than a percent , even as economic data made available Thursday in the U.K. showed dismal numbers amid the coronavirus pandemic.
As for the Asian markets, Tokyo’s Nikkei 225 index closed up 1.5 percent as sectors such as real estate and transportation rebounded from Wednesday losses. The Bank of Japan is expected to have a policy meeting on Monday with stimulus reportedly on the agenda, particularly bond repurchases.
“Everything is up today – gold, equities, even bonds. It’s a ‘risk-on’ day,” said Rupert Douglas, head of institutional sales at digital asset management firm Koine. “The question is whether when equities head south again, will bitcoin be correlated, like last time, or uncorrelated?”
Author: Bradley Keoun
BTC Pre-Halving Pump in Play as Bitcoin Price Surges Toward $8,000
After trading in the $6,900 to $7,250 range for more than 19 days, Bitcoin (BTC) price finally managed to pierce the $7,250 resistance in a high volume surge which resulted in the liquidation of nearly $70 million worth of shorts at BitMEX.
BitMEX XBTUSD Liquidations. Source: Skew.com
The strong upside move allowed the digital asset to secure a higher high at $7,738, a price not seen since before March 13 when the Bitcoin price crashed to $3,750.
With just 18 days to go before the Bitcoin halving event, traders and hodlers will both be wondering whether this is the long awaited pre-halving pump or just another short squeeze that moved the price up a step before attempting to tackle $8,000.
Crypto market daily performance. Source: Coin360
Some would conclude that the surge to $7,738 is important as it lessens the likelihood of Bitcoin dropping to recent lows below the $6,900 support.
While true, $8,000 and $8,500 have long been expected to present considerable resistance and while crypto Twitter may be uber bullish on Bitcoin, the Crypto Fear & Greed Index shows investors remain extremely cautious about Bitcoin’s short-term prospects.
Crypto Fear & Greed Index. Source: Alternative.me
While the index shows a marginal increase in crypto market sentiment over the past month, the current reading at 19 is still in the “Extreme Fear” category, not exactly where one would expect it to be 18 days before halving.
BTC USDT daily chart. Source: TradingView
As shown on the daily chart and predicted in previous analysis, the squeeze up to $7,700 exploited the small volume gap on the VPVR from $7,160 to $7,743 dead on and the next challenge can be found at the 61.8% Fibonacci retracement where the 100 and 200-day moving averages reside.
The Bollinger Band moving average is also smack dab on the 100-MA so its expected that flipping $8,000 to support will be a challenge. Even if the price pushes above $8,000, the VPVR shows $8,500 as another level of resistance but one would hope that by the time this level is reached $8,000 and $7,500 will be ready to provide support.
After reaching the daily high at $7,738 the price quickly pulled back $200 but at the time of writing the MACD continues to rise above the signal line and histogram shows a continued increase in momentum on the 4-hour and daily timeframe.
BTC USDT 4-hour chart. Source: TradingView
The RSI also remains in bullish territory on both timeframes but on the 4-hour and 1-hour timeframe traders will notice that buy volume has pretty much returned to its pre-surge level.
Alongside declining volume, the long upper wicks on the last three candles also signals that short-term momentum is fading as traders take profits and possibly anticipate that either the price will consolidate in the current range or pullback to retest the former resistance levels.
For the time being, traders should watch volume to see if a build up in buy volume provides the signal that the price will attempt to attack the 61.8 Fib level at $7,924.
Given that at the time of writing, Bitcoin appears to be losing some of the momentum which pushed it to $7,700 earlier today, traders might also look for the price to retest previous levels of resistance in the $7,450-$7,300 range.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Author: Horus Hughes