Bitcoin is back on the move, trading around $9,400.
Last weekend, the price of bitcoin took a fall to $8,600 only to start making its way up after Goldman Sachs’ bearish and uneducated coverage of the world’s largest cryptocurrency.
However, the digital asset is still trading in the range it has been in throughout May.
Also, with RSI over 60, we are not in bull territory yet.
The relative strength index (RSI) of an asset is a momentum indicator which if goes above 70%, the asset is considered overbought and below 30% it is oversold.
— PlanB (@100trillionUSD) May 28, 2020
The bitcoin market might not be there yet but we are surely getting signs that indicate we are moving towards the start of the next bull run.
For starters, 60% of all bitcoin hasn’t moved on the blockchain for at least a year, which is an indication that investors are turning to hodling. Also, the last time this happened was in early 2016, at the start of the bull run.
As we reported, institutions are currently consuming more Bitcoin than being created. Grayscale Investment’s Bitcoin Trust has bought 18,910 BTC since the halving while only 12,337 BTC has been mined during this time. They also have a lock-up period of 6 months.
In Q1 of 2020, Grayscale and Square together accounted for more than 50% of all the bitcoin minted in the quarter.
“The supply shock is real and we'll see the effects of that soon enough,” said Whale Panda.
Bitcoin price is currently doing what it has been for the past few weeks, compressing with higher-lows and lower highs. What needs to be seen is if this will continue in the coming weeks, before we have a large breakout.
— Credible Crypto (@CredibleCrypto) May 29, 2020
According to Charles Edwards of Capriole, bitcoin needs to move up with a strong volume to continue its ascent to above $11,500. In the past 24 hours, $2.25 billion worth of bitcoin exchanged hands.
“A close above 9300 with volume and you may never get $8K bitcoin again,” he said.
— Jonny Moe (@JonnyMoeTrades) May 29, 2020
Just before the weekend, bitcoin is heading with a nice upward sloping futures curve.
However, today is the day when approximately 2,000 May contracts on CME will be expiring. Before this, open interest meanwhile is climbing over $250 million.
Bitcoin options on CME have been seeing steady growth, just yesterday, options had a new record with July calls now trading in good size.
“Short term skew has collapsed to flat in the last few days as bitcoin options traders turn bullish,” notes Skew Markets.