Bitcoin breaks through $11,000 in one fell swoop, and the shorts are hammered again

Bitcoin is known for its volatility, but after spending the past three months stuck in a narrow range between $9,000 and $10,000, volatility returned last week.

According to data from qkl123.com, at around 6 a.m. Beijing time on July 28, the price of Bitcoin soared to a high of $11,394, and then fell slightly. As of press time, the price of Bitcoin remained above $11,000, while a week ago, Bitcoin was still around $9,100.

According to statistics from coinalyzetool, more than $500 million worth of Bitcoin short contracts were liquidated during this rally.

This is noteworthy because Bitcoin has already surpassed the important price barrier of $10,500.

Rob Sluymer, technical strategist at Fundstrat Global Advisors, previously told Bloomberg:

“We remain positive on Bitcoin’s overall structure and expect it to breakout above $10,000-$10,500 as part of its long-term bullish technical picture.”

Sluymer also pointed out that Bitcoin needs to break through the $10,500 “resistance zone” and once Bitcoin breaks through this level, its next resistance level will be at $13,800.

This type of technical analysis aligns with the “wave theory” of price fluctuations and a related analysis tool called the Fibonacci sequence, which gained traction during the 2017 cryptocurrency bubble.

Three possible factors driving Bitcoin's surge

So what’s driving the bitcoin price surge? According to industry professionals, it doesn’t appear to be driven by a single catalyst.

According to Eric Turner of Messari Research, cryptocurrency traders have recently made a lot of money in so-called decentralized finance (DeFi) digital currencies. Turner speculates that many traders have converted their profits into two mainstream crypto assets, Bitcoin and Ethereum, to drive their prices.

In addition, last week the U.S. Office of the Comptroller of the Currency announced that banks can hold Bitcoin on behalf of their clients. Many in the cryptocurrency industry saw this as a bullish signal and predicted that this could lead to new investments in cryptocurrencies by large funds.

Another possible reason for the surge in Bitcoin prices is the general global uncertainty. Such sentiment may lead investors to look for assets like gold, which has recently hit all-time highs due to concerns about the global COVID-19 pandemic and geopolitical uncertainty. According to a report from The Block, Bitcoin, known as "digital gold," may be benefiting from the same phenomenon.

What do you think about the surge in Bitcoin prices?

Link to this article: https://www.8btc.com/article/628052
Please indicate the source of the article when reprinting