Bitcoin price has increased to $8,300 — a 10 percent increase from 24 hours ago — marking a new 2020 high and what many analysts are calling the bottom of the latest Bitcoin cycle.
The last time we saw such an increase was on April 1st when BTC/USD briefly traded at around $9,000. This time, however, it seems that there is no joke involved: markets have seen consistent gains ever since then and today’s pump represents one of the largest in recent months.
Bitcoin is currently trading at over $8200 – its highest level since May 2019 after an expansion from $7800 to $8320 within hours on Monday morning (UTC). To be fair, Bitcoin has rallied by about $100 over the past week. So if you had bought in at the bottom of this “cycle,” you might have made some money.
However, as noted by crypto analyst Josh Rager on Twitter, this current rally is slightly underwhelming in comparison to historical rallies following a bottom in Bitcoin price. The Fibonacci sequence is a series of numbers where each number is the sum of the previous two numbers. It’s been used by traders and analysts to predict Bitcoin price movements since before the January 2019 bottom. The idea is that if you can find a low volume area in crypto, you can use historical data to predict when it will be hit again.
Bitcoin: Investors Pessimistic About A Recovery
Light has been using this theory to make predictions about Bitcoin, but he doesn’t believe today’s pump hit his “ideal Fibonacci targets.” There has been a lot of talk about what caused today’s 10% pump in the price of Bitcoin, but the most obvious answer is that it was due to a large purchase order made on Bitstamp by an unknown party.
While this may mean that we finally see some activity from institutional investors and whales, it is important to remember that there have been many times when such pumps were seen after prolonged periods of stagnation.
One of the most famous examples occurred during October 2013 when BTC experienced its first big surge from $100 to $1,000 within just three weeks — only for its price to crash again soon after as orders were liquidated once they could no longer be fulfilled at high prices.
While the current rally appears to be “underwhelming” in comparison to historical rallies following a bottom, it is important to note that the crypto market has changed significantly since those days.
With less retail involvement and more institutional investment coming into play now than ever before, it may be time for traders to start taking a closer look at how they approach their trading strategies when considering whether or not we’ve reached an actual bottom yet.