Bitcoin Slowly Going Back Up After Falling Close to $10.5k Mark

How to Invest in Bitcoin and make Money

Bitcoin has been seeing a steady rise for the last two days since its fall after the president of the United States was declared positive for Covid-19. Experts believe that this drop in price is linked to that fact that the announcement from the White House also called off the negotiations that were to happen with lawmakers regarding the stimulus package. At the time of writing this article, the price of bitcoin is standing at $10,894. This is a noticeable difference for the time it took to gain back its momentum and the market is responding to the positivity as well.

QCP Capital’s weekly investor note mentioned that bitcoin staying above $10k in the current negative news scenario is quite promising for the cryptocurrency. QCP Capital is a well-known quantitative trading company. It said, “We’d need to see a break below the key $10,000 level to have any downside follow-through.” The note also said that “We are likely just treading water and building momentum until after the elections when we think the coast will then be clear for a new bull trend to develop.” The price of Bitcoin has remained between $10,000 and $11,000 since the beginning of September.

According to the head of institutional sales at DV Chain Michael Rabkin “The crypto markets are still very highly correlated to traditional markets and the broader economy as a whole.” He also said that “We believe that any time markets tick up or tick down this is exaggerated in crypto. The correlation is still very high.” DV Chain is a cryptocurrency market making and liquidity services provider. One of the biggest news currently going around is the fact that Bitcoin has been moving very much in a similar pattern as that of the stock markets. However, it is worth noting that even though the trends look the same. Bitcoin has been providing much higher returns as compared to the stock markets.

The cryptocurrency options market is also quite interesting with Bitcoin traders holding open interest options for more than 36,000 BTC that are to expire at the end of October. According to those options, the probability of Bitcoin seeing a value above $11,000 is about 37%. The probability of crossing $10,500 is 53% and staying above $10,000 is 68%. A key insight provided by Rabkin from DV Chain is that the flow of Bitcoin is matching traditional markets more than ever before because of more and more seasoned investors joining the crypto trading business. He said, “As bitcoin is becoming a new asset class for institutional market participants, its sensitivity to macro events will rise over time.”

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