According to global markets analyst Alex Krüger, the bear trend of Bitcoin is technically over after its abrupt and massive rally.
“Technically, BTC bear trend is over. Fundamentally, market changed in the last two months for the worse beyond just price. Miners implosion likely incoming. Impressive BAKKT volume spike (low base effect), now 2% of CME’s. Today’s +15% in my opinion clearly related to China’s news.”
The short term upside movement of bitcoin was crucial in preventing a further downside movement below key support levels at $6,800 and $6,300, which were being considered as possible targets following weeks of stagnancy.
Later in the day after Bitcoin had surged even higher, Kruger added:
$BTC has moved +42% today
– 4th largest gain in history and largest since May/10/2011 (if comparing against daily returns).
– 15th largest two-day gain in history, Nov/18/2013.
Thank you China.
President Xi is the true Crypto Dad.
— Alex Krüger (@krugermacro) October 26, 2019
Bakkt sees record-high volume but it’s not a big Bitcoin mover
Subsequent to the $2,500 movement of Bitcoin from around $7,500 to $10,000, the volume of Bakkt, a regulated bitcoin futures market operated by the parent company of the New York Stock Exchange, achieved a new record high at 1,179.
Today we set a new daily record of 1,179 Bakkt Bitcoin Futures contracts traded
— Bakkt (@Bakkt) October 25, 2019
Each contract on Bakkt is equivalent to 1 BTC and as such, 1,179 indicates a daily volume of 1,179 BTC or $11.79 million.
While Bakkt is growing and it is expected to eventually evolve into a platform that accurately reflects demand from accredited and institutional investors, for now, it only accounts for a small fraction of exchanges.
In comparison, BitMEX saw more than $150 million worth of shorts liquidated as reported by CryptoSlate, 50 times larger than the entire daily volume of Bakkt.
What happens next for BTC?
With analysts like Krüger suggesting that technicals indicate a strong trend reversal for bitcoin, traders are looking at historically important resistance levels in the $8,000 to $9,000 range to confirm a breakout.
“Bullish candle that woke the market, was hedge short myself 1x got stopped out and still up in BTC. Late shorts got punished and literally knocked out all stops A great start but still want to see price break/close above previous resistance $8,374+.”
Another investor said that the current state of the cryptocurrency market can be described as a bull market and that bulls will likely continue to take control. He noted.
“If today’s BTC price action did not serve as enough of a reminder, let me say it again…this is a BULL market and bulls will take control when they please.”
Altcoins flying high
Off of the strong upside movement of Bitcoin, Ethereum climbed from $161 to $191, by more than 17 percent within two hours.
The price of XRP also spiked from $0.27 to more than $0.3, by well over 10 percent within the same time frame.
The price of Litecoin surged from $49 to $60, a gain of over 20 percent.
Analysts generally anticipate that the overnight rally of Bitcoin is likely to ignite the start to an extended rally and a potential trend reversal to the upside throughout the short to medium term.
The spike in the price of bitcoin comes at a crucial time after dropping to the lowest level since June.