For the first time in about two months, Bitcoin rose above $10,000.
People are set to capitalize on this move as bitcoin inflows into centralized exchanges start to increase “significantly.” Currently, we are seeing the largest hourly net flow spike in over three months.
After seeing gains throughout last week, the world's largest cryptocurrency ended the week above $10k. Today, it is currently trading around $10,470 on the back of the strong volume, $2.65 billion exchanged hands in the past 24 hours (real value).
Bitcoin gains have been in complete contrast with the S&P 500, which did not have a good week but is following gold, which broke into a new all-time high and continuing just to go higher and higher as the dollar falls and concerns rise about the health of the world economy as well.
As we reported, the good news came in the form of the US office Comptroller of the Currency, which said American banks can now hold bitcoin, provide custody services for customers' digital assets, which will help boost the asset class's appeal with investors.
What's to Come
Bitcoin has been hovering near its 50-day moving average for weeks before the price pulled above it in the last couple of days.
According to a report from JP Morgan Chase & Co. strategist John Normand, bitcoin has been enjoying above-average flows this year, which have been high versus their five-year average and compared to exchange-traded funds (ETF) in other assets.
However, Bitcoin needs another leg higher, at least to break through the key $10,500 level from where the path is clear for the flagship cryptocurrency to fly.
“Take out $10,380 this month or next month, and we're looking very good for some huge upside,” said trader Nebraskan Gooner. “Until then we must show caution at these levels. Every time we've gone above $10k in the last 12 months we have gone back below $9,000 after,” he said.
IT'S A FUCKING BULL MARKET ARE YOU READY!!!!! pic.twitter.com/GNtalIQwDI
— Arthur Hayes (@CryptoHayes) July 27, 2020
“We remain positive on the overall precise structure for Bitcoin and do expect it to push through $10,000-$10,500 as part of its longer-term bullish technical profile,” said Rob Sluymer, technical strategist at Fundstrat Global Advisors LLC.
Even so, that range “remains a resistance band that Bitcoin will need to break above to signal its next move to resistance at $13,800,” he added.
The fact that bitcoin hasn't made a weekly close over resistance and lower time frames are losing volume and momentum; traders haven't turned entirely bullish yet as BTC could “easily take the highs over the range in the first half of the week and still close under.”
“Bitcoin will likely, in turn, consolidate its position above the key $10,000 level,” is what Bequant's Denis Vinokourov thinks the digital currency would do.
— Alistair Milne (@alistairmilne) July 27, 2020
Now, going ahead, bitcoin has a volatile week in its wake with the Treasury Secretary to introduce a fiscal package followed by an FOMC meeting on Wednesday, along with an antitrust hearing with the CEOs of Amazon, Google, and Facebook.
Towards the end of the week, Facebook, General Electric, Boeing, Apple, Amazon, and Google will report its earnings. US GDP reports for the June quarter will also be revealed on Thursday while Eurozone will be out on Friday.