- Bitcoin [BTC] gained 6.32% on 2nd September 2019, as the price breached $10,000 yet again.
- The escalated trade tension between the US and China and the world economic turmoil is the likely cause.
- Bitcoin’s dominance over crypto markets breached 70% for the first time in two years.
The price of Bitcoin [BTC] at 2: 00 Hours UTC on 3rd September 2019 is 10,350. It recorded a high of $10,470 during the last few hours yesterday.
The trade war between China got worse on Sunday when the two countries imposed tariffs to hurt the import/export business. While the Trump administration imposed 15% on more than $125 worth Chinese imports, China levied a 5% tax on crude oil. This is the first time crude oil or petrol/diesel has been targetted.
Even Peter Schiff, who is an eternal basher of Bitcoin, is starting to make peace with the rising correlation between Bitcoin price and trade tension. He tweeted,
As trade tensions rise and the yuan falls, Bitcoin is trading back above 10K. But don’t believe the hype that this rise reflects safe-haven buying, similar to gold…
However, he still believes that there is a higher degree of speculation in it than the actual utilization as a safe haven.
Nevertheless, the number of times Bitcoin has reacted positively to the trade tensions is starting to look more than just co-incidences. With the Yuan dropping and the US dollar facing resistance as well, traders are looking for an exit to hedge their wealth.
Altcoins to Take Further Losses?
Moreover, the dominance of Bitcoin over the crypto markets breached 70% for the first time in 2 years. The percentage market caps of Ethereum and XRP are 7.3% and 4.3% respectively.
Majority of altcoins have lost their value, apart from a top few alts the market cap most altcoins is below $1 billion. This makes them vulnerable to manipulation. Furthermore, the low liquidity in alts would begin delisting from exchanges. Peter Brandt, a crypto-trade noted in a tweet,
When will altcoin junkies understand that $ is the crypto with real and lasting value. Altcoins are to Bitcoin what lead is to Gold
While a reversal is possible, a capitulation of altcoins is also on the cards. This could lead to a further increase in the dominance of Bitcoin.
The altcoin utility and speculation has stalled during the last year. The altcoins traders will be looking forward to positive regulatory step or adoption to switch fundamentals. However, Josh Rager, a crypto-trader tweeted,
…With Bakkt coming, we may not see a strong pullback in BTC market dominance anytime soon
Trading Bitcoin in the Short Term
Furthermore, while Bitcoin seems to have gained a lot of bullish momentum once again, some traders are still uncertain. Sawcruteez is looking forward to a short position. While Tone Vays is a ‘little bit skeptical’ as well. Even Crypto Face, a trader, said in Tone’s Trading Bitcoin update,
I do believe that we have a good drop coming, most likely in September or October.
The market sentiments are highly uncertain as to the RSI on the 4-hour has crossed 80, and there is still considerable fear in the market.
Nevertheless, the lower time frames are bullish, and the attention towards Bitcoin is increasing as well. A strong bullish break could defy all bearish odds. The trading in the next few days will be instrumental in assessing the order for the rest of the year.
Where do you think the cryptocurrency market is headed next? Please share your views with us.
Disclaimer The views, opinions, positions or strategies expressed by the authors and those providing comments are theirs alone, and do not necessarily reflect the views, opinions, positions or strategies of CoinGape. Do your market research before investing in cryptocurrencies. The author or publication does not hold any responsibility for your personal financial loss.
Nivesh from Engineering Background is a full-time Crypto Analyst at Coingape. He is an atheist who believes in love and cultural diversity. He believes that Cryptocurrency is a necessity to deter corruption. He holds small amounts of cryptocurrencies. Faith and fear are two sides of the same coin. Follow him on Twitter at @nivishoes or mail him at nivesh(at)coingape.com