Bitcoin Relief as Sudden Spike Restores $10,000

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Bitcoin Relief as Sudden Spike Restores $10,000

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All it took was half an hour in afternoon European trading yesterday but Bitcoin was the benefactor of a USD 1,000 price spike for no explainable reason to take the digital asset back above USD 10,000 for the first time in over two days.

At around 10:10 pm EDT (2:10 pm UTC), as Bitcoin surrendered support and touched a 24-hour low of USD 9,282, price suddenly shot up over the next 30 minutes to over USD 10,290. And as American markets took over from Europe, price continued to ascend steadily to a high just an hour ago at USD 10,797.

What gave now seems to take away, however, as with London waking up, Bitcoin experienced a sharp fall to trade now at USD 10,357 at 9:45 am London time (CoinDesk).

The immediate sentiment apparent all over social media has been that of relief, since the bears did seem to be in full control this entire week. And with price trading well below the five-digit psychological resistance for two days, it appeared that even lower floors would be breached, with some charts already showing a possible plunge below even USD 8,000. Now that price is back up above USD 10,000, there are those who insist that the current series of retracements from every attempt to make a new high has only resulted in new buyers looking to enter the market at attractive price points.

Some also believe that it was the BitMEX news that reported on yesterday that could have caused the previous dip, and that now people are recovering from that, price is just returning to its level before that news resurfaced.

Apparently, even the Libra hearing coverage seems to be coming down as well. Japan’s leading paper The Yomiuri Shimbun published news yesterday that spoke of “red flags” about Facebook’s Libra crypto project, saying as much as that it “could pose a threat to state sovereignty in the issuance and management of currencies, and become an uncontrollable cryptocurrency beyond the surveillance of authorities”. Yet in Japan, Bitcoin price was almost unaffected, so it would appear that the effect of negative sentiment from Libra could now be on its last legs.

Fundstrat’s Tom Lee, as before, continues to assert that all this media coverage by Washington is actually “too much of a good thing” because it might actually go as far as push the Trump administration into escalating the whole issue. For him, the perfect storm of Brexit, US-China trade wars and Euro banks will push people towards Bitcoin, although it will be “choppy until then”.

In China, the Hangzhou Internet Court based in Hangzhou, Zhejiang Province’s capital, has now ruled that all individuals holding Bitcoin still cannot use it as a legal currency, but they can be considered to own virtual property and a specific commodity. It isn’t great news, but it does demonstrate a relaxed attitude over digital currencies. Specifically, a report has quoted a People’s Bank of China official named as Li as saying: “Indeed, Bitcoin is virtual property, but it’s not fiat money.” Li also confirmed the central bank was researching crypto.

Many analysts see blockchain and crypto as yet another area over which the two biggest economies in the world will fight for supremacy. Cao Yin, a blockchain expert in China, told the Global Times:

“Digital currency is a frontier financial instrument, over which China and US will have financial competition.”

One analyst, Vince Stanzione, notes that he keeps seeing buyers come in every time a dip happens, and that USD 10,000 is a “good support” level and the dip buying “is a positive for bitcoin before [the] next move up”.

Altcoins holders and traders themselves will probably also be relaxing their grips on the sell buttons, as alts took the lead from Bitcoin and took their valuations up in the last day. Litecoin is at the moment the one enjoying the best day, beating even Bitcoin by recording a 6% rise (CoinMarketCap). Others leading the altcoin charge are Stellar (5.5%), TRON (5.7%) and Monero (4.6%).

While the mood is far from being upbeat in the altcoin market, at least the signs are almost perfectly neutral right now and a range for consolidation could be on the cards if the next few days bring no significant movement. For now, crypto traders can take a brief break in this temporary period of sideways trading to plot their next moves.

The only issue now that Friday is upon us, is to wait and see if these new price points will be taken advantage off by scalpers. Those waiting to see if the rise would continue might give up and Bitcoin would then suffer at stops close to USD 10,000. Many will hope that a return to weekend strength is at hand for the bulls. is committed to unbiased news and upholding journalistic codes of ethics. For more information please read our Editorial Policy here.

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