Bitcoin Price (BTC) surged above $8,000 again, before settling comfortably around $7,700. It seemed the asset’s slide did not wipe out buyers’ interest, and the factors that boost the price of BTC are still strong.
In the past days, BTC was at a crossroads, potentially seen falling further, but it picked the upward direction.
the final wedge. after ~four months of correction $BTC now remains at a crucial level to decide the course for the rest of the year. bulls working to hold $6k support while bears further attempt to drive down the market. decision will be made once wedge is broken either way pic.twitter.com/nd9eG6wzqy
— CryptoYoda (@CryptoYoda1338) April 11, 2018
Here are the five chief reasons BTC reacted so strongly:
Tethers in Waiting
The USDT tokens were kept at bay in the past days, as their trading share sank. But just like that, USDT trading doubled in volumes, easily increasing the BTC price. The evidence for this is in the premium price on Bitfinex and Binance – exchanges where the USDT trading is most active. Curiously, this time the price in Korean Won is lower, the equivalent of $7,400, while in USDT terms the leading coin trades around $7,700.
For some reason, the positive sentiment in Bitcoin was led by Japan, before spiking during the early hours of Western trading. At the same time, the share of Japanese Yen trades fell from 59% of all trades to just 42%, as the dollar market awakened. Still, Bitcoin remains popular as Japanese exchanges are shaking off regulatory fears.
US Buyers Return
US buyers are tentatively returning, possibly awaiting the end of the US tax season to start buying anew. US buyers are one of the biggest demographics, potentially injecting new fiat into the markets. The GDAX trading sees BTC at $7,727, just below the Bitfinex levels, showing a strong upward bidding in dollar terms.
Positive Sentiment Returns
Perhaps buyers were standing on the sidelines, waiting for an appropriate moment to jump into the markets once again. With volumes doubling overnight, there were enough traders to boost the trend. Additionally, the strong performance of altcoins gave the markets further confidence, and BTC soon followed.
Sudden and dramatic moves are sometimes the result of algorithms getting triggered. At this point, it is unknown what may happen once human emotions hit the mix, and some expect a sudden correction to lower levels. The price rise is exaggerated compared to the last few days, and the algorithmic trading may be the cause.
While Bitcoin tended to drop and drift for months, this time, the fall and recovery may play out much faster, as more mainstream interest is flowing into BTC. This may accelerate the next climb, which some expect should repeat the summer performance in altcoins. Still, the levels around $8,000 look tame compared to the nearly $20,000 peak.