Bitcoin price simply secured a new 2020 high and traders count on the cost to increase higher for 3 key reasons.
On Oct. 21 Bitcoin (BTC) price overtook the $13K mark to achieve $13,217 following traders took out critical resistance levels at $11,900, $12,000, and $12,500 within the last 48 hours. While generally there are various technical reasons driving the abrupt upsurge, there are three important factors buoying the rally.
Earlier today, PayPal officially announced that it’s allowing users to invest in and sell cryptocurrencies, like Bitcoin.
During the entire past season, speculations on PayPal’s potential cryptocurrency integration continuously intensified after a variety of reports claimed the business was working on it.
In an official statement, CEO, the president, and Dan Schulman of PayPal, confirmed the cryptocurrency integration. He wrote:
“We are desperate to work with central banks as well as regulators all over the world to offer the support of ours, and to meaningfully add to shaping the role that digital currencies will play down the road of global finance as well as commerce.”
Sui Chung, the CEO of CF Benchmarks, a subsidiary of Kraken exchange, told Cointelegraph which bullish sentiment is actually likely returning to the crypto sector. According to Chung:
“Bitcoin passing $13,000 nowadays, a 16 month high, demonstrates this trend is just picking up speed. That PayPal, a house name, has gotten a conditional BitLicense is actually likely propelling bullish sentiment. Today is significant as a signpost for further price appreciation inside the future… the point by that mainstream mass media and’ mom & pop’ list investors may quickly begin to show interest in the asset, since they did within late 2017.”
Bitcoin dominance is rising In the past week, Bitcoin has outperformed substitute cryptocurrencies, decentralized financing (DeFi) tokens, and Ethereum.
The dominance of Bitcoin. Source: Josh Olszewicz
Josh Olszewicz, a cryptocurrency specialized analyst, stated the dominance of BTC is actually above a critical moving average. Technically, this hints that Bitcoin could continue to outperform altcoins within the near term. Olszewicz said:
“BTC dominance back over the 200 day moving average for the very first time since May, king corn is actually back.”
BTC shows a bullish higher time frame structure Throughout October, traders have pinpointed the advantageous technical structure of Bitcoin on the higher time frames.
Bitcoin’s weekly chart, for example, has shown a breakout and surpassed the previous local top attained in August.
BTC/USD weekly chart. BTC topped out from $12,468 on Binance and proceeded to fall under $10,000. As mentioned previously, today’s high volume surge took the cost to a new 2020 very high at $13,217, which is well above the earlier local top.
In the short-term, traders foresee that the industry will cool down after such a reliable rally. Flood, a pseudonymous crypto futures trader, said:
“I believe we are quite overextended on $BTC for right now. I would imagine seeing a tad of a retrace in which we make an effort to find support in the 12.2 12k range. Not saying we cannot run more, but hedged a tad here.”