The bitcoin price increased from $9,766 to $10,500 in the past 24 hours as its dominance over altcoins and the rest of the cryptocurrency market hit 70 percent.
Prior to the minor rally, technical analysts and cryptocurrency traders including Josh Rager and Flood suggested that bitcoin could move below $9,000 to test lower levels if an important support level in $9,300 was breached.
“Odds are you’re likely free rolling a short with a tight stop here. IF 9.3k breaks on this run volume is anemic and selling will most likely accelerate us down to 8.4k. Could possibly even wick to 8k, but I’d start scaling in long anything close to 8.4k,” Flood said on August 31.
However, following the highly anticipated weekly close of bitcoin, the dominant cryptocurrency demonstrated strength in smaller time frames, moving past a key psychological level at $10,000 with a steady increase in volume.
Flood noted that the structure in which BTC could have moved down to test $8,000 has been invalidated, indicating that the asset is in a better position to aim for an extended rally than late August.
In the short term, technical analysts anticipate the asset to test the wide range between $9,400 to $11,500.
Although some major altcoins in the likes of Ethereum and Bitcoin Cash recorded gains in the range of 4 to 6 percent as bitcoin recovered, against both USD and BTC, most altcoins are down by well over 50 percent and 80 percent, respectively.
According to one cryptocurrency trader, against bitcoin, most altcoins listed on widely utilized margin trading platform BitMEX are down from 50 percent to 70 percent on average with the exception of Litecoin.
In the next 12 months, bitcoin has several fundamental factors that could contribute to its upside movement.
For instance, the potential effect of the launch of Bakkt on the short-term price trend of BTC is anticipated by traders as it would offer the first physically settled futures contracts for BTC.
Ahead of the block reward halving in mid-2020, some miners are also said to have financed the next 12 months of operations with the intent of holding onto the BTC they mine, expecting the price to rise over the medium term.
Altcoins, however, have struggled throughout the year to secure a strong footing in a wildly volatile market, unable to demonstrate correlated movements with BTC during small rallies.
Last modified: June 23, 2020 2:34 PM UTC