The price briefly crossed the $5,000 in several major regions on April 2, officially surpassing the $4,800 mark in global average price.
The price surges 19 percent within minutes (source: coinmarketcap.com)
The somewhat expected increase in the price of left many investors, including industry executives, bewildered about the factors that led the dominant to surge.
1st Factor: A Purely Technical Move
Throughout the past week, CCN that the $4,200 resistance level is crucial for the near-term price movement of and once the level is breached, there exists a possibility it leads to a significant upside movement above $4,500.
As soon as an $80 million sell wall at $4,200 was absorbed by buyers, $500 million worth of short contracts on BitMEX were squeezed out, further fueling the rally of .
Yep
— Barry Silbert (@barrysilbert)
A purely technical move above a key resistance led sell walls to fall, short contracts to be liquidated, and retail investors to demonstrate fear of missing out, or FOMO, ultimately causing to increase by 19 percent within minutes.
But, a compelling argument can be made that the bull rally is only just beginning.
2nd Factor: Rising Volumes, Intensifying Interest
According to a well-recognized technical analyst and trader who goes by the moniker ‘Galaxy’, buy volumes of on achieved an all-time high.
On Tuesday, following a strong 19 percent upside movement by , CEO Changpeng Zhao, better known to the community as CZ, said that it caused the system of the exchange to overload, causing the platform to underperform for a short time frame.
“Some UI server scaling issues, affecting some users, being fixed now. API should be scaling fine,” CZ said, adding, “it was not a “try to cut server cost” issue. Parts of the system that was supposed to auto-scale didn’t. Should be better now.”
buy volume at an all time high on .
— Galaxy (@galaxyBTC)
Although some investors have said that they were not able to initiate trades during the period in which was suffering server issues, the exchange saw an unforeseen spike in demand after four months of low volume and stagnation in the market.
The rapidly rising volume across major exchanges demonstrate that the interest of retail investors is rising once again, improving the overall sentiment around the asset class and the market as a whole.
3rd Factor: Banks, Funds, Family Offices, Every Institution are Talking About Crypto
Economist and global markets analyst Alex Krüger said that virtually every fund and family office talked about after the asset surged by 19 percent overnight.
Everybody outside crypto is talking about today.
From banks to funds to family offices to brokers.
— Alex Krüger (@krugermacro)
The price movement of was particularly noteworthy because investors feared that following 3 months of stability from January to March, it may plunge in value as it did in November 2018.
The interest towards and the rest of the market was already rising prior to the sudden upside movement due to the involvement of Fidelity, ICE, Nasdaq, and other large financial institutions in crypto in recent months.
4th Factor: bitcoin Rose, Not Alternative Cryptocurrencies
Throughout the past two months, both major crypto assets and alternative in the likes of , , and Ontology recorded large gains against in the tune of 30 to 100 percent.
Technical analysts said that the strong performance of enabled the market to stay afloat despite the stagnant price trend of .
The upside trend of could significantly boost the confidence of existing investors in the market in the near-term.
5th Factor: Industry Developments
In synergy with the price trend of , the industry has seen progress in areas that needed much improvements such as institutionalization and merchant .
In the past two weeks, the largest e-commerce platform in Switzerland accepted payments and a luxury Swiss hotel integrated payment methods.
Published at Tue, 02 Apr 2019 16:17:46 +0000
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