Bitcoin (BTC) starts a new week over $ 11,000 After a wild weekend when the market dropped $ 1,200 in minutes. Will the chaos continue?
Cointelegraph offers you five factors that could easily affect Bitcoin’s price development in the coming days.
The gaps in Bitcoin futures continue to grow
More than usual, This week appears to be big in terms of Bitcoin-specific market phenomena.
In the past few months there have been macro factors that determine the general course of the price. BTC / USD in particular shows a strong correlation with the equity markets.
After two weeks of much more volatile activity Bitcoin has been decisively separated from the stock market promotions. The analysts’ attention is now focused on the traders of Bitcoin derivatives themselves.
On Monday, the CME Group’s Bitcoin futures opened significantly lower than last Friday. The resulting market gap of between $ 11,450 and $ 11,600 could well be a short-term price target..
As Cointelegraph often reports, Bitcoin tends to rise or fall to “fill” the gaps in CME futures. However, Aside from this weekend, there is another gap that has not been closed, this time much lower, between $ 9,660 and $ 9,930.
For Michaël van de Poppe, analyst at Cointelegraph Markets, The $ 1,000 area above the lowest gap was now needed to get it as support, $ 10,800.
“”If we lose that support, we will most likely go to the support we had before, which is the $ 10,000 range“That is also the CME gap”, summarized in a new one Video update.
The CME Bitcoin futures chart shows two gaps. Source: TradingView
Warnings before the fall of the US dollar
At the time of going to press, when stock markets slowly opened on relatively stable conditions, BTC / USD had not yet reached a new level after having held at $ 11,200 in the past 24 hours.
Changes in global economic sentiment still have a significant impact on investing in Bitcoin. In this week, The focus will be on the heat between the United States and China, along with new incentives for the Washington Corona virus.
The situation is precarious Bitcoin has risen in recent weeks as the dollar continues to decline. At the same time, investors have rushed to safe havens such as gold and silver.
The ongoing USD weakness could send a new bullish signal for the Bitcoin price movementwhether it is simply a function of the coronavirus response or not.
“”The currency bet is primarily a bet on the relative control of the virusThis does not reflect the fundamental strength of the economies in question, “Stephen Jen, CEO of Eurizon SLJ Capital, a UK macro investment firm, told Bloomberg.
A piece of news that can have wider implications than just social and political ones is U.S. President Donald Trump’s plan to ban the Chinese social media platform TikTok.
The video platform has become the target of the growing conflict between Beijing and Washington;; Trump cites national security concerns over his operations.
On Sunday, Cointelegraph reported why the TikTok ban could impact cryptocurrency markets.
The performance of the platform has already been demonstrated sufficiently, a user-led advertising campaign to revive the assets of Altcoin Dogecoin (DOGE)
Gold on the way to $ 2,000
The gold mood can serve as a precursor to any change in Bitcoin’s progress. The precious metal remains at its highest level ever in US dollars to exceed the psychologically significant $ 2,000 mark..
“”Gold has risen in 8 consecutive weeks and ends at the highest monthly closing price in its history. Silver has also risen in 8 consecutive weeks, with the highest month-end since April 2013, “summarized on Friday. Peter Schiffand added:
“The dollar index has been falling for 6 consecutive weeks, with the lowest month-end since April 2018.”
Last week, Citigroup analysts were less optimistic about the XAU / USD, so there was a possibility that USD 2,000 would appear 30% by the end of the year..
At the time of printing $ 1,973 suggested that investors didn’t have to wait that long.
One week XAU / USD chart. Source: TradingView
Consumer interest in BTC is palpable
TOReaching $ 12,000 over the weekend has brought Bitcoin back to general awareness. Especially the success of altcoins those from Ether (ETH) have increased the interest of the press.
“People try to use the moment. The entire cryptocurrency market is a microcosm of everything that happens in stocks“Analyst Mati Greenspan summarized the Wall Street Journal.
In response, Bill Barhydt, CEO of Abra, the payment company, announced this Consumer interest in cryptocurrency has definitely changed.
“Consumer interest in Bitcoin is definitely growing now“he tweeted and added:
“Abra has had a record deposit volume since we opened our Abra interest account last week. I’ve heard similar comments from others. “
As Cointelegraph reported last week, Google Trends data confirmed this Price volatility had led to increased search activity for both Bitcoin and gold.
Graph of the aggregate open positions of one-month Bitcoin futures. Source: Skew
Back to the derivatives markets The increasing open interest and volume of Bitcoin options suggests that institutional investors remain strongly interested in short and medium-term profitability..
The old coins are not over yet
Bitcoin continues to struggle with altcoins for profitability;; Ether continues to suppress long-term resistance over several time periods.
At the end of July, altcoins rose to the delight of investors, led by ETH / USD when trading in ERC-20 tokens exploded during the DeFi boom.
Ether hit $ 400 over the weekendand fell to $ 364 before its highest level since August 2018.
Chart of BTC / USD versus ETH / USD of 1 month. Source: Skew
Conversely, BTC / USD did not hit a weekly close above USD 11,500, a psychological achievement that would have marked its best performance from its all-time high of $ 20,000.
Overall, Bitcoin appears to be less strong than Ethereum“Van de Poppe added in his update.