BTC consolidation ended right as the coin started surging and is now trading for $11,430 which is the highest price since September. Over the past day, the cryptocurrency increased by about 5% having trading around $10,900 as reported in the latest Bitcoin news.
BTC’s strong surge higher is quite abnormal as one day ago the cryptocurrency was underperforming most of the altcoins. Analysts on Twitter commented that this could be a sign that BTC could outperform altcoins for a while. One fund manager commented that “the king is waking up and reminding everyone why it’s king.” The BTC Consolidation ended and as Mohit Sorout, the founding partner of Bitazu Capital commented, it suggests that Bitcoin will move higher as a result of spot market volume.
Bitcoin waking up and reminding everyone why it is king 🔥
— Pomp 🌪 (@APompliano) October 10, 2020
This can be seen by the premium on spot exchanges compared to futures exchanges. The premium is slight but shows which side of the market is boosting the price action. During the move higher, there was about $38 million worth of short-slide liquidations on BitMEX alone. This indicates that there could be a derivatives element on Bitcoin’s move higher. Open interest will recover soon suggesting that the investors are still hesitant to short the rally. Funding rates started to inch higher which corroborate the assertion made by the analysts. Analysts do believe that the news about the potential fiscal stimulus is boosting the capital into BTC.
— Mohit Sorout 📈 (@singhsoro) October 10, 2020
Mike McGlone who is a senior commodities analyst at Bloomberg made a comment on the fiscal policies and their ability to drive BTC in the upcoming months:
“A potential Biden presidency should shine favor on further appreciation in the price of #Bitcoin. New leadership may change the hands-off policy of the Trump admin. – to the detriment of the broader crypto market – and nudge Bitcoin toward the mainstream, improving ETF chances.”
On a short-term basis, it was revealed that the stimulus talks are still ongoing in Washington. It was also revealed that there are about $1.8 trillion stimulus bills in talks which are below the first $2.2 trillion that was floated a week ago. Whatever the case might be, the US dollar is crashing lower on these continued discussions. As a result of these talks, Bitcoin gained traction.
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