Step One: Resistance is futile as Bitcoin exceeds $ 15,000 and Crypto becomes greedy

Bitcoin was lower and lasted after a three-day rally that saw prices near $ 16,000, the highest level since early 2018.

In the recent rally, the largest cryptocurrency rose 116% since the start of the year, and some bullish digital asset market analysts have already seen an even higher level. Denis Vinokourov, head of research at the crypto prime broker Bequant, said in an email that there is a possibility that the options market will drive prices up in the next few days.

“This, combined with the ongoing uncertainty about US election results and the economic fallout from the resurgence of the Covid pandemic, could lead us to push for $ 17,000,” he said.

In traditional markets, US futures were lower than prior to a closely watched government report released Friday on October employment trends. Gold rose 0.3% to $ 1,956 an ounce.

Bitcoin price chart for the first time since early 2018, spiking over $ 15,000.

Source: TradingView

Market moves

As Bitcoin shot above $ 15,000, analysts dipped into the cryptocurrency’s 11-year history on Thursday for clues as to what was coming next.

Prices have already doubled this year, just as they did in 2019, and Bitcoin is now openly discussed by global banks like Deutsche Bank as the world’s top performing asset. Many observers say that price movements are random and not necessarily related to broad macroeconomic trends. While the relationship remains on the weaker side, the correlation between cryptocurrency price movements and traditional markets has increased for most of this year.

And the investment narrative bitcoin fund marketers are putting up looks pretty strong right now: not only has the cryptocurrency been viewed by many bulls as the future of money and possibly a threat to the existing financial system, but it’s also positioned as an inflation hedge to one With the Federal Reserve and other central banks printing trillions of dollars in money to stimulate markets and economies, there are few obvious signs of slowing down.

Now, many traders believe that the fear of missing out, or FOMO, could accelerate cryptocurrency adoption among both retail and institutional investors – and quickly push prices to a new record high of over $ 20,000.

This is where the history lesson comes in. As some analysts signaled this week, bitcoin prices have now entered an area they have so rarely visited before that investors are reading price chart patterns – a widespread practice among crypto traders known as “technical” analysis “- see easy-to-spot breakpoints between $ 15,000 and $ 20,000.

“The technical setup has been in place for some time and has finally broken through,” Mati Greenspan, founder of forex and cryptocurrency analysis company Quantum Economics, told subscribers in an email.

Course completion history by level

Source: Messari

The screenshot above from Messari, a digital asset market research firm, shows that Bitcoin previously traded above the $ 15,000 price level for just 20 days, all in 2017.

And it was powerful indeed: once it topped the $ 15,000 level, Bitcoin quickly rose to its all-time high near $ 20,000.

Matt Blom, sales and trading director at digital asset company Diginex, called it a “price vacuum.” The speculation now is that a repetition might be in the cards.

All of this could be wishful thinking from traders who are analysts and investors who really don’t have any more insight into the future than anyone else and are just lucky enough to be at a time when the rapidly growing ecosystem seems to be one of the Digital asset markets to be the few sectors that are really thriving.

Fear and greed

Source: Arcane Research

Slow, steady progress might be more compelling for newcomers and “crypto-curious” than a quick march up that quickly reverses. Be that as it may, the prevailing sentiment in the market a month ago is pushing for “extreme greed” due to “fear”.

“The case for Bitcoin is getting stronger every day,” said Messari. “Resistance is futile.”

If there are any.

Bitcoin clock

Worldwide search for keywords “Bitcoin price” since 2015.

Source: Google Trends

Web search data suggests that public interest in Bitcoin remains at normal levels despite a sharp price rebound to nearly $ 16,000.

The top cryptocurrency has seen nearly 50% gains over the past four weeks, trading as high as $ 15,971 early Friday, a level last seen during the bull market rush between December 2017 and January 2018.

Some watchers say the rally is now being fueled by retail greed and fear of missing out known as FOMO. However, Google data suggests otherwise.

Google Trends, a barometer for measuring general interest in trending topics, currently returns a value of 10 for the global search query “Bitcoin price”.

This is significantly less than the 93 value observed in early December 2017 after Bitcoin’s record break above $ 15,000. The current reading is also below the 19 high seen in the second week of May when Bitcoin “halved” its third mining reward.

Google’s data suggests that retail investors are calm in the face of Bitcoin’s recent rally and that the market is far from in a bull frenzy.

With population interest still relatively low, it is safe to say that FOMO has not yet entered the market and that the ongoing institutional rally has legs.

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What is hot?

The founder of Ethereum, Vitalik Buterin, sends 1.4 million USD ether in preparation for the upgrade of the second largest blockchain network “2.0” to the staking system (CoinDesk).

Jack Dorsey’s Cash App generated Bitcoin sales of $ 1.63 billion in the third quarter of 2020 (CoinDesk).

The flawed code in this compound finance fork only frozen $ 1 million in Ethereum tokens (CoinDesk).

Fidelity Launches Initiative to Hire Engineers to Build Crypto Trading and Custody Services (The Block)

Bitcoin’s “accumulation addresses” rise to a record high of more than 519,000 (CoinDesk).

South Korean crypto companies must disclose the identity of users as part of the planned change in the law (CoinDesk).

The operators of Lightning networks are getting ready for the curious new users who usually come with a bull run (CoinDesk).

Bitcoin is the new Amazon (CoinDesk Opinion)

The Swiss fintech company Taurus wins Sygnum Bank as a customer of Digital Asset Custody Services (CoinDesk).

Transaction fees for Ethereum are falling as the DeFi fever subsides (CoinDesk Research):

Ethereum fees.

Source: Coin Metrics, CoinDesk Research

Analogues

The latest on economics and traditional finance

The October US employment report is expected to show a 530,000 increase in non-farm payrolls, down from 661,000 in September (CNBC).

Australian regulator cuts assets banks must hold in a central bank-approved facility by $ 25 billion. This confirms that institutions are increasingly buying government bonds that are considered to be low-risk in order to reach the threshold (Reuters).

Unemployment claims in the US are still high, past 751,000 last week (St. Louis Fed).

The Federal Reserve keeps interest rates close to zero, keeps buying assets, advocates more fiscal support, and pledges more financial support if needed (CoinDesk)

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