It’s green again! Bitcoin has recovered and is performing strongly, gaining 6.3 percent in the past 24 hours. The currency hit $3,680 earlier today, a level it last hit on Thursday. At press time, the currency was trading at $3,636 according to data from CoinMarketCap. In some markets such as the Hong Kong-based HitBTC, the currency was trading north of $3,750 and was showing no signs of regression any time soon. The bounce back is especially crucial given the bloodbath that usually occurs during weekends.
With the market having sunk to new yearly lows in the past month, the question about where the bottom really lies has been constantly debated. While no one knows for certain as unpredictability has been one of the key tenets of the industry, it’s beginning to look likely that $3,280 may just be it. Since hitting that level, the currency has gained over 12 percent in less than 2 days and looks set to continue rising to reclaim the $4,000 level in the next few days.
Why Finding the Bottom Is Crucial
After hitting $3,280 on Coinbase and many other markets, Bitcoin looked set to test $3,000 and many traders and investors had resigned to this fate. However, the currency had other ideas and quickly rebounded to hit to hit $3,470. Even though there was a brief tumble to $3,350 today, the currency has regained its momentum and has gone on to reclaim $3,600.
Bitcoin was trading above $3,600 on most major global markets at press time. On CoinBene, Binance and OKEx – three of the four-largest markets globally – the currency was trading at $3,620. BitMEX, which accounts for 25 percent of the trade volume was lagging behind at $3,550, with HitBTC registering the highest price among major markets at $3,750.
Bitcoin looks to have found its bottom two days ago after it hit its lowest level this year just below $3,300. On Coinbase, the currency was trading at $3,280 and many traders were in panic mode. Since then, the entire market has seen major gains and looks set to kick off the new week with great momentum.
Finding the bottom is quite crucial for the currency as it could enable the currency to finally kick off its journey back to major support levels and beyond. With retail traders having the confidence that the market has bottomed and that they no longer stand the risk of losing their entire portfolio, panic selling will no longer be widespread. This will bring back stability, something the market has lacked for the past five weeks.
External Factors Still Having Major Impact
While the price rally is quite notable, there are still external factors at play that will have a major impact on whether the momentum is sustainable. One of these is the all-out involvement of institutional investors. While there have been expressions of interests, the approval of a Bitcoin ETF, as well as the launching of Bakkt in January, will greatly determine the path that Bitcoin’s price takes.
While 2018 has ended with no definitive laws governing cryptos, ICOs and STOs, 2019 could see the implementation of strict laws that will set the tone for the industry. This year, a number of ICOs have made away with investors’ money and this has affected the perception of the industry. Some of the nations that have begun setting up a legal framework include Japan and Malta, but the new year will see more nations take a stand on cryptos and this will determine the path the industry takes.
Green for 24 Hours? Fantastic! Unheard of… or, well, these days, at least.
I think I’ll wait some more before popping the champagne. It could be just a fluke.