The last 5 days have been hectic for the crypto market, and most especially the Bitcoin market. The crypto sprinted from $6k to $8k in no time. The sudden change has Bitcoin investors startled, with a lot of FOMO going around. However, Bitcoin’s current price activity can be traced back to about 6 strong factors backing it.
Anticipated Bitcoin Halving
The third Bitcoin halving is expected to take place in May 2020, and it’s a dynamic that has been known to stir up the market. A look at the previous halving instances reveals that Bitcoin’s price starts mounting up about a year before the event, building up to a major bull run.
As such, May 2019 has long been expected to bring some goodies to the crypto market, all courtesy of Bitcoin. From the look of it, it’s already happening.
One of the most impactful developments in any industry is the flow of capital. The more investors bring in money, the better things get. The Bitcoin market has attracted quite some heavy-weights of late, including Fidelity Investments.
With such strong backing from institutional funding, Bitcoin is now gaining strength and acceptance as a viable store of value. In fact, some people are already talking about Bitcoin eventually replacing Gold.
It’s simple: The laws of demand and supply dictate the market price for any given commodity. That said, a lot of Bitcoin owners have decided to hoard it in anticipation of a better price. These people are called “hodlers.” The more the hodlers with more Bitcoins, the less the actual circulating supply available for purchase, and the higher the price gets.
The Golden Cross
An asset is said to have formed a Golden Cross when its price breaks through a strong resistance level and its 50-day moving average exceeds the 200-day moving average. That happened to Bitcoin back in April, indicating an oncoming bull run that has since started. Just about 3 weeks after forming the golden cross, Bitcoin’s price has jumped by over 40%.
As it turns out, Bitcoin whales aren’t in a hurry to sell. Instead, they’re moving their coins away from exchanges and into unknown wallets, signaling that they’re not in the mood to trade anytime soon. The most recent whale activity involved the moment of 20,000 BTC worth around $100 million right before the bulls began the charge.