Bitcoin (BTC) starts again on Monday and hits $ 59,500. Is this the week we see $ 60,000?
After a promising but cautious weekend, BTC / USD is back to breaking resistance as major markets reopen.
Given the strength of the underlying specs and buyer demand, bulls could be celebrating for the next few days. However, the resistance kept them in check for weeks.
Cointelegraph presents five things that can help shape Bitcoin price action.
Dollar down on oil pipeline attack
Stocks started on a familiar positive note in Asia as traders bet on existing highs that continued to hit.
A new all-time high for the S&P 500 index last week created a lively mood. The coronavirus pandemic did nothing to degrade historical returns for various markets.
BTC / USD vs. S&P 500 chart. Source: TradingView
Commodities were dictated by the ransomware attack in the US that pushed oil prices to a three-year high before the market calmed down.
“This interruption in the distribution of refined gasoline and jet fuel underscores the vulnerability of our national critical infrastructure in cyberspace and the need for effective cybersecurity defense,” Bloomberg quoted a government statement as saying.
The dollar suffered from the attack and the US dollar currency index (DXY) suddenly rebounded in a move that pushed Bitcoin above $ 58,000.
On Monday, when the pipeline was still closed, there was only a slight rebound in evidence, allowing for the potential for more DXY-based gains for BTC / USD.
As Cointelegraph often reports, DXY and Bitcoin are usually inversely correlated, but that relationship has become more unpredictable this year.
United States Dollar Currency Index (DXY) 1 Day Candlestick Chart. Source: TradingView
The record hash rate precedes the great difficulty
It’s all systems for Bitcoin – at least when it comes to network basics.
After last month’s sudden drop in hash rate related to the flood of miners in China, network strength and the associated price trend have rebounded significantly.
The process was already evident last week, and commentators noted that the negative impact of the event was practically behind Bitcoin.
Now, however, the projections reflect unprecedented interest and competition among miners, along with a firm commitment to the future of the network.
According to the on-chain monitoring resource Blockchain.com, the hash rate is now at a new high. The seven-day average ranges from 131 exahashes per second on April 25th to 177 EH / s as of Monday.
Bitcoin 7-day chart with average hash rate. Source: Blockchain.com
The difficulty, which automatically corrected itself downwards to take account of the decline in miners, is now also due to a greater self-increase if it adjusts itself again in about two days.
At 13.5%, the projected increase in difficulty is the largest since June last year.
If the old adage “price follows hash rate” proves as true today as it used to be, Bitcoin hodlers could feel the price advantages in the coming weeks.
BTC price on the verge of $ 60,000
In terms of price advantages, traders this week are looking for a “stepping stone” effect in the BTC spot price action that could lead to a breakout.
After climbing and moving backwards for the past few days, but making broader highs and lows by and large, Bitcoin will make a more engaging statement.
On Monday, popular trader Crypto Ed said a leg should end $ 800 lower from current levels near $ 59,000 before a resurgence clears the crucial $ 60,000 resistance zone.
“BTC plan for today: Minor correction after 5 legs. Looking for a jump and a continuation towards 62k and 68k after that. Potential jumping area (green box) = 58100-58200 ”, he commented on Twitter next to a projection map.
BTC / USD 1 hour candle chart (Bitstamp). Source: TradingView
The battle for ultimate resistance near the all-time high of $ 64,500 has been raging for several weeks. Any attempt to overcome salespeople has resulted in price drops of various strengths.
A look at the order book structure of Binance, the world’s largest exchange by volume, showed that the $ 60,000 zone was still held on Monday, supported by incremental sell walls below the highs.
Conversely, buyer support was only seen at USD 50,000, which offers a wide potential trading range should BTC / USD fall again.
Composition of the BTC / USD order book (Binance). Source: material indicators
The ether blows up $ 4,000
Bitcoin may have to wait for its ultimate boost to break the highs – altcoins are already running hot this week.
Cryptocurrency market capitalization chart. Source: CoinMarketCap
Led by Ether (ETH), Monday returned after a mixed performance over the weekend for the majority of large-cap cryptocurrencies.
ETH / USD, always surprising, shot above USD 4,000 that day and showed no signs of slowing as it hit new all-time highs and confirmed traders’ predictions for an attack to USD 5,000.
The altcoin’s biggest gains weren’t just seen beyond simple price promotions. According to the analysis resource CoinMarketCap, the total share of Ether in the market capitalization for cryptocurrencies is now 19.1%.
That market cap topped $ 2.5 trillion on Monday as Bitcoin’s share fell closer and closer to 40%.
The crypto market value hits $ 2.5 billion while #Ether hits a record high of> $ 4,000. # Bitcoin’s price is currently ~ 59 kW / dominance, hitting 44%, its lowest level since 2018, while Ethereum dominance is at a record 18%. pic.twitter.com/vhI2I8QPPw
– Holger Zschaepitz (@Schuldensuehner) May 10, 2021
With ETH / USD up 31% in a week, other altcoins started to copy their success. Cardano (ADA) hit its profits, while Litecoin (LTC) and Bitcoin Cash (BCH) each had a weekly return of nearly 50%.
Conversely, high-fliers from yesteryear have been much calmer, with Dogecoin (DOGE) and Ethereum Classic (ETC) both flat after hitting their own highs last week.
Strong hands increase their position
Escaping the short-term narrative for just a moment creates the familiar feeling that everything is fine in Bitcoin.
While altcoins are booming in a trading frenzy, a slow but steady transfer of Bitcoin wealth from weak to strong hands continues, says well-known statistician Willy Woo.
Analyzing the data late last week, Woo emphasized that this year’s bull run is different from the rest – because speculative hands don’t last long and seasoned hodlers are buying up the lull at prices higher than ever.
“This cycle is different; The movement from coins to strong holders is unprecedented, ”he summed up using data from the on-chain monitoring resource Glassnode.
As Cointelegraph reported, the trend has characterized different phases of 2021 in terms of BTC price.