Bitcoin price just secured a brand new 2020 high and traders expect the cost to climb higher for three key reasons.
On Oct. 21 Bitcoin (BTC) price overtook the $13K mark to attain $13,217 following traders took out critical resistance levels during $11,900, $12,000, and also $12,500 during the last 48 hours. While generally there are different technical reasons behind the abrupt upsurge, there are three factors which are important buoying the rally.
The 3 catalysts are a favorable technical framework, PayPal enabling cryptocurrency purchases, and Bitcoin‘s rising dominance fee.
Earlier today, PayPal officially announced that it’s allowing users to invest in as well as sell cryptocurrencies, like Bitcoin.
During the entire previous year, speculations on PayPal’s potential cryptocurrency integration constantly intensified after numerous reports claimed the business was doing work on it.
In an official statement, CEO, the president, and Dan Schulman of PayPal, established the cryptocurrency integration. He wrote:
“We are wanting to work with central banks as well as regulators all over the world to give our support, as well as to meaningfully add to shaping the job that digital currencies will have fun with down the road of global finance as well as commerce.”
Following PayPal’s expression, the price of Bitcoin immediately rose through about $12,300 to all the way to $12,900.
Sui Chung, the CEO of CF Benchmarks, a subsidiary of Kraken exchange, told Cointelegraph which bullish sentiment is actually likely returning to the crypto market. In accordance with Chung:
“Bitcoin passing $13,000 today, a 16-month high, demonstrates that this pattern is just picking up pace. That PayPal, a household title, has gotten a conditional BitLicense is very likely propelling bullish sentiment. Today is actually substantial as a signpost for more price appreciation in the future… the place by which mainstream press and’ mom & pop’ retail investors may quickly start to show interest in the asset, since they did inside late 2017.”
Bitcoin dominance is rising In the previous week, Bitcoin has outperformed alternative cryptocurrencies, decentralized finance (DeFi) tokens, and Ethereum.
The dominance of Bitcoin. Source: Josh Olszewicz
Josh Olszewicz, a cryptocurrency specialized analyst, stated the dominance of BTC is actually above a key moving average. Technically, this suggests that Bitcoin might will begin to outperform altcoins within the near term. Olszewicz said:
“BTC dominance returned over the 200 day moving average for the very first time since May, king corn is actually back.”
BTC shows a bullish high time frame system Throughout October, traders have pinpointed the advantageous specialized structure of Bitcoin on the higher time frames.
Bitcoin’s weekly chart, for example, has revealed a breakout and surpassed the earlier area top achieved in August.
BTC/USD weekly chart. BTC topped out from $12,468 on Binance and then proceeded to fall below $10,000. As said before earlier, today’s higher volume surge took the price to the latest 2020 high at $13,217, and that is well above the earlier local top.
In the short-term, traders foresee that the market will cool down right after such a strong rally. Flood, a pseudonymous crypto futures trader, said:
“I believe we’re extremely overextended on $BTC for now. I’d imagine experiencing a tad of a retrace where we attempt to find assistance in the 12.2 12k range. Not saying we can’t run further, but hedged a tad here.”