Roses are red, violets are blue, Bitcoin hits $49K and a new all-time high too
The price of Bitcoin (BTC) achieved a new record higher up $49,000 on Valentine'southward Mean solar day on Feb. fourteen, rising to as high as $49,344 on Coinbase.
There are three master reasons Bitcoin surged to a new all-time high, namel high stablecoin inflows, clean break of the $38,000 resistance area, and a prolonged consolidation phase.
High stablecoin inflows were key
Throughout the past several days, despite Bitcoin's consolidation beneath $38,000, on-concatenation analysts pinpointed the continuous increase in stablecoin inflows.
Co-ordinate to data from CryptoQuant, a data analytics platform, the Stablecoin Supply Ratio (SSR) rose significantly as it rallied from the mid-$xxx,000 region.
The SSR indicator shows the ratio of the market cap of Bitcoin relative to the aggregated market cap of stablecoins.
When the toll of Bitcoin rises in tandem with the SSR ratio, and then information technology means it is likely being driven by sidelined capital letter re-entering the market.
This trend is highly optimistic because it shows that the rally was non just driven past an over-leveraged futures market place. In fact, information technology was genuine demand from the spot market that led the uptrend.
Atop the high stablecoin ratio, analysts also pinpointed the turn down in selling force per unit area coming from miners.
— Lex Moskovski (@mskvsk) February 12, 2021What is also interesting is that miners are not then eager to sell their #Bitcoin the last two weeks.
Either they are convinced it is going upwards or but are out of bullets. pic.twitter.com/GDYzP33948
The combination of the lower selling pressure from miners and the increasing stablecoin inflows into exchanges catalyzed the ongoing Bitcoin rally.
$38,000 resistance cleanly breaks
Bitcoin was consolidating under the $38,000 resistance area for a prolonged period. This presented a risk to the brusque-term bull cycle of Bitcoin.
When the price of Bitcoin hovers under a key resistance area for a long time, information technology increases the probability of BTC dropping to a lower back up area to tap lower liquidity.
This is partially the reason why Bitcoin regularly dropped to around $44,000 earlier its eventual impulse rally to a higher place $38,000.
Long consolidation was benign for BTC cost breakout
A relatively long consolidation period normally leads to two scenarios: a severe breakdown or a major breakout.
If Bitcoin rallies without strong fundamentals to back up the rally, there is a bigger run a risk that the consolidation leads to a deep correction.
But, in the case of Bitcoin in the last three days, its consolidation phase nether $38,000 was backed by ascension stablecoin inflows, a high Coinbase premium, and a by and large high trading volume across both spot and futures markets.
Hence, fifty-fifty though the futures market remains highly leveraged and overcrowded, BTC has been able to push button through the resistance surface area despite the risk of a long clasp.
In the foreseeable futurity, there are several reasons that brand the rally sustainable. Kickoff, the stablecoin inflows are not slowing downward.
Second, today's rally reversed the surly market structure to a bullish short-term trend beyond lower time frames.
As long as Bitcoin remains above the $38,000 level, which has turned into a support expanse, its near-term bullish marketplace structure would remain intact.
Source: https://cointelegraph.com/news/roses-are-red-violets-are-blue-bitcoin-hits-49k-and-a-new-all-time-high-too
Posted by: carterhinatimsee.blogspot.com
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