We’re rounding up this week with another record for Bitcoin and the price above $1,160, only a day after it nearly breached the $1,200 mark thanks to a period of no negative market evens. However, it’s never a smooth ride for Bitcoin, as the cryptocurrency has never been safe from volatile swings.
The past days also brought another note-worthy event for Bitcoins, as the Prime Minister of Malta, Joseph Muscat, talked about turning Europe into a Bitcoin continent at the CEPS Ideas Lab Brussels conference. According to Times of Malta, the prime minister talked about several innovative changes, including regulating cryptocurrencies, for which he said the EU would be able to slow down but never stop.
Muscat told the attendees that instead of trying to resist cryptocurrencies, EU’s legislative body should try to create and invent mechanisms to regulate them. This, he said, would allow the governments to harness the potential of virtual currencies, protect their users, as well as make Europe the “natural home of innovators”.
Bitcoin Hits a Record High
The biggest news this week was that Bitcoin hit a record high of approximately $1,204.55, surpassing its previous record of $1,165 from 2013. Three years ago Bitcoin saw an incredible leap thanks to a global mania for the cryptocurrency, growing nearly $1,000 in the course of several months, only to crash violently amidst panic from the Mt.Gox exchange which lost thousands of users’ BTC in a hack attack.
Even this year was not as smooth, as Bitcoin entered 2016 with a value of approximately $420 – a level which was slowly building upwards to reach $470 in spring and then break $500 in August. And now, half a year later, the price hit a new all-time record.
With Bitcoins at a record high, the tech world is naturally buzzing on the next course of Bitcoins and the reason behind this milestone. One interesting explanation, according to Tech Crunch, is that Bitcoin is becoming more closely tied to the stock market than it was before. Namely, the coinciding growth of Bitcoin and traditional stocks is one clue that the cryptocurrency may be turning into a more traditional payment method which would continue to follow the market closely in the future.
Volatile Swings and High Volume
With Bitcoin touching $1,200 there were bound to be bears looking for a profit. While during the past several days buyers were still holding the price in check, today’s trading took a different course. Thus, in the course of an hour, the price plunged down from $1,202 to $1,113, only to recover back to the $1,160 range an hour later, where it has since stayed.
Our data shows that the market is seeing unusually high interest, as the trading volume is now $317,603,000, almost three times more than two days ago. Coincidentally, the market cap is likewise higher, at $18.7 billion. Due to the high volume, you are advised to keep a close watch, as the price could change fast, like it did this morning.
Our technical analysis shows that the market is in a neutral position, with 5 out 12 oscillators in the buy zone and the moving averages split between sellers and buyers. The SMA 100 is safely above the SMA 200 on this frame, so there is less resistance to the upside.
From the current trends, the price seems locked between sellers and buyers, looking for support at $1,165. However, with such a high volume and bear pressure evident on short-term signals, there’s no safe path. If sellers keep pushing, we will see a drop below $1,150.