Bitcoin – What a Difference a Day Makes!

Bitcoin touches $4,400 before pulling back, key through the day ahead being a hold onto $4,000 levels to avoid a reversal.
Bob Mason
Bitcoin Brown

The Bitcoin bulls came alive on Wednesday and not a moment too soon, $2,000 levels looking on the cards if sentiment didn’t shift, with Bitcoin rallying by 10.86% to end the day at $4,305, the bounce seeing Bitcoin reverse Monday’s 5.52% slide with interest, following Tuesday’s 0.49% gain.

A particularly bullish start to the day saw Bitcoin rally from a morning intraday low $3,882.9 to break through the day’s first major resistance level at $4,000 and the day’s second major resistance level at $4,117.37 to a mid-morning high $4,163.9 before easing back.

Tracking the broader markets, a second rally saw Bitcoin move through to a late in the day intraday high $4,447.6, breaking through the day’s third major resistance level at $4,392.67 with relative ease to hit a high for the current week before sliding back to $4,300 levels by the day’s end, investors taking some cream off the top.

The day’s rally was seen across the crypto board, with some of the majors gaining in excess of 20% on the day, driving the total market cap up to $138.1bn, with reports indicating that Bitcoin internet searches had hit levels not seen since back in April that coincides with the month that Bitcoin enjoyed its largest single daily gain of the year, a 14.2% gain back on 12th April.

Following a millpond October, Bitcoin has regained some of the vim seen through much of the year, with Bitcoin having seen 2 days of double digit losses last week during the crypto meltdown, investors having to go back to June for the last pre-November double digit daily slide.

Unsurprisingly, Bitcoin’s hash rate has been on the rise over the last 24 hours, recovering to 42.5384E, having dipped to 36.8556E on Tuesday, the lowest level since July 2017 when Bitcoin broke through to $2,000 levels on the day.

There’s been plenty of talk of the fall back in hash rates, but when considering where price levels have moved from and the fact that some miners have shifted to more favourable crypto mining environments, profitability is unlikely to be a major issue for the Bitcoin mining cartel, just for the smaller players who compete for the scraps in high mining cost environments, which would have contributed to the pullback in hash rates.

Interestingly, the market bounce came in spite of news that SEC Chairman Clayton was not ready to approve any Bitcoin ETFs, with concerns over the SEC’s pending decision on the 9 applications under review having contributed to the negative sentiment across the broader market, along with the Bitcoin Cash hard fork and a series of dire news releases.

Time will tell whether investors have moved on from sitting on the side waiting for the institutional money to come pouring in, but with one key driver now seemingly put on ice for another time, the door was ajar for the bulls to take the reins, favourable news and a hold onto $4,000 levels now key in the coming days.

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