Bitcoin [BTC] surges from $7,400 to record a high at $10,350. It’s price recorded a huge 35% rise on the daily.
The rise from $7400 to $10000 occurred in less than 12 hours. Moreover, it was characterized by three large candles — the last being the longest with a $900 rise in an hour. The previous two huge candles recorded combined gains of $1170. At $10,000, the total growth within 12 hours has been about $2500.
It is the third-highest daily gain in Bitcoin in its entire history. Nic Carter, from Coinmetric, tweeted,
If we close at 10k we’d be looking at the 3rd highest 1D return in Bitcoin’s history (38%), surpassed only by 11/6/10 (54%) and 5/10/11 (48%) (@coinmetrics data)
The rise is primarily attributed to the Chinese President’s declaration to make China the leader in Blockchain technology. The last two candles were witnessed from 8-10 am, according to the Shanghai Time Zones. Hence, it seems like the strong influence of China over Bitcoins’ price is massive.
On the fundamental front, a couple of other positives to Bitcoin price is the growing US debt crisis and also the increased supply of Tether.
US Debt Crisis
The US Treasury Department announced on Friday that the budget deficit has increased to about $1 trillion for the fiscal year. It has seen a 26% raise this year, with Trump’s administration failing terribly on its promises to wipe-out the deficit.
Furthermore, quantitative easing measures adopted by the Feds further threatens increased spending. This vicious cycle of unsustainable growth projects uncertainty for the long term future.
New all time high in M1 money supply.
The Fed keeps cranking. pic.twitter.com/bMYykg3uYD
— Sven Henrich (@NorthmanTrader) October 25, 2019
This narrative has more often than not favored Bitcoin’s price as limited supply, uncorrelated asset.
Bitfinex and Tether Correlation
The CEO of Crypto Capital, the firm entrusted by cryptocurrency exchanges for custody and international purposes, was arrested on Friday by the Polish Authorities. The charges pressed against him included money laundering and involvement in the global drug cartel.
Reportedly, earlier, Bitfinex lost access to $850 million worth of crypto assets to Crypto Capital. As reported earlier on CoinGape, iFinex and Tether have denied involvement in all criminal activities of their ex-fund manager.
Furthermore, with the arrest and trial, the crypto exchanges can now hope to revive their assets.
The rise has come as a surprise, even for the bulls. It broke above several resistance levels with much ease. Short liquidations creating another short squeeze like the situation was also one of the primary driving reasons for the humongous candles after the break.
The price of Bitcoin [BTC] at 3: 20 hours UTC on 26th October 2019 is $9530. Hence, even before the write up is complete, an $800 volatility is witnessed. The price will look for previous support levels to begin consolidation before the next move.
Where do you see the price of Bitcoin [BTC] at the weeks close? 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