It’s time for an in-depth look at the recent amazing Bitcoin price action. It’s been a big week for Bitcoin, that’s an understatement. The previous yearly high for 2019 was set at $4200, and in a momentus singular move on April 2nd the leading cryptocurrency skyrocketed to over $5000 in a single day, leaving traders around the world stunned.
The move was so sudden that it left every news site both inside and outside the cryptocurrency industry scrambling to discover the secret to the immense pump. Theories were widespread, but the most likely reason is that one individual buyer stocked up on $100 million worth of Bitcoin from 3 of the leading exchanges – Kraken, Coinbase, and Bitstamp.
The $100 million Bitcoin was bought on Kraken, Coinbase, and Bitstamp
The orders took place over the course of an hour, and were roughly 7000 BTC worth on each exchange, amounting to $100 million USD, and amassing over 20,000 BTC in total.
However despite the large increase in buy volume as a result of the nameless crypto whale, experts are concerned that if bitcoin’s volume doesn’t stabilise and hold up that the price will plummet back down to its original levels.
This has been a wake up call for the cryptocurrency industry, showing that the original giant is still alive and kicking, and is about to wake up to continue moving back up towards where it left off with the late 2017 $20,000 Bitcoin price high.
A wake up call for bitcoin investors lying in wait
This wake up call has sparked buy volumes across the board, and since the original $100 million order went through, Bitcoin’s price has kept at a steady level between $4800 and $5300.
After the original order that caused the instant push to $5100, the price immediately stabilised to $4800 – but instead of leveling off there it continued to rise slowly over April 2nd, with no signs of slowing down, and culminated in a peak price of $5300 at the end of April 3rd.
This is fantastic news that may confirm buy interest is still there in the average trader, as a usual price pump due to a large buy order would more often that not result in a rapid descent back to the original price level.
Bitcoin’s price decline to a low of $4850
April 4th was spent in a steep decline from $5300 to a low of $4850, stabilising now on the 5th at $4950.
After this sudden rise, experts are concerned that if buy volume doesn’t increase rapidly that we will indeed see a fall back to the $4300 region. Trading volume is usually an accurate indicator of price action – if the sudden spike is correlated with a low volume, the chances are that the price will fall back to its original level, as the move would have been a one off action that won’t have any serious effect on sentiment or valuation of an asset. However if there’s a large buy volume in conjunction with a huge price increase, it’s usually a sign that the price could stabilise or even rise higher.
Bitcoin is a unique cryptocurrency in the fact that it dictates the movements of all other coins associated with it – so while some altcoins may not be affected by a large buy order, Bitcoin itself is susceptible to changes in public opinion and buyer sentiment purely because it’s not traded against anything else apart from traditional fiat currency like the dollar.
Bitcoin google search volume increased 3x
Another thing to note is that with the sudden spike came a 3x increase in google search terms for bitcoin, which may point to renewed interest over the coming days and weeks.
Search volume interest has always closely followed the bitcoin chart, so we can’t draw anything conclusive from the renewed interest – however we can indirectly hypothesise that this renewed interest will spark more and wider interest in bitcoin and cryptocurrency in general, as large news outlets outside of the crypto industry have increased their coverage dramatically this week. Traders will tell their friends and family, and those who’ve hodled bitcoin for the past year’s bear market will be delighted in the recent rise and will take a look at their long-forgotten wallets.
Over the last year there hasn’t been a single event which has gathered more renewed interest in Bitcoin, so this positive news could be a catalyst for the next bull market to begin.
Is someone who’s willing to wager $100 million on positive Bitcoin price action likely to be wrong?
Analysis of specific price actions aside, looking at the facts – a large whale, either an individual, a group of people, or a company with extensive financing has decided to wager more money than any of us are likely to see in our lifetime in a gamble on Bitcoin’s immediate future.
Generally, those who accumulate enough money to be able to spend $100 million freely on a volatile cryptocurrency like it’s a fancy dinner out – will know what they’re spending their money on, and will have extensive research by groups of people who give their all towards predicting investment outcomes.
Regardless of what public sentiment currently is, and regardless of the charts in front of us – the fact that one of the largest whales we’ve ever seen enter the cryptocurrency markets has staked this amount on one currency, in one single day, tends to make one believe that they know what’s coming.
Has this Bitcoin price action sparked the next bull market?
No trader or investor, whether in traditional financial markets or cryptocurrency, can know for sure when the bottom of a bear market is in until the trend reversal has been confirmed. Only in hindsight can we see what the market was really doing.
December 15, 2019 at $3200 was Bitcoin’s price bottom. At least that’s what it appears to be now we look back. That was nearly 4 months ago, and since then, there’ve been higher lows on the charts, and the last 2 months have even seen an extremely strong uptrend with no signs of a dip.
Looking to the year ahead, we can have a fairly high chance of predicting that $3200 was the lowest Bitcoin price we will ever see again. Whether this means more sideways chart action, a steady rise, or even a full on bull market, we don’t know – but you can rest assured that things are certainly looking up right now.
Investors, it may be time to breath a sigh of relief.