Bitcoin

Key Indicator Shows Renewed Inflow Of Capital Into Bitcoin

Published

2 years ago

June 25, 2021

An indicator that has historically marked major price bottoms is pointing to a renewed flow of capital into bitcoin.

The stablecoin supply ratio oscillator created by analyst Willy Woo and tracked by blockchain analytics firm Glassnode has risen from a 12-month low of -2.6 to -1.9 in the past four weeks.

The recovery indicates capital has been flowing from stablecoins into bitcoin, Glassnode tweeted Thursday. In other words, bargain hunters look to have employed stablecoins to buy the dip in bitcoin and broader crypto markets.

Stablecoins are cryptocurrencies with value tied to an external reference like the U.S. dollar. They are essentially proxies for fiat currencies, offering a price-stability advantage that other digital assets do not have, and are widely used to fund crypto purchases. The total market capitalization of stablecoins has surged 10-fold year-over-year to more than $100 billion, according to Messari.

The stablecoin supply ratio (SSR) is the ratio of the bitcoin supply and the stablecoin supply denoted in BTC. “When the ratio is low, the buying power for bitcoin is high, as the same amount of USD can buy relatively more BTC. Conversely, a high ratio means fiat has the weak buying power,” Glassnode said in the explainer blog post.

The stablecoin supply ratio oscillator helps traders identify extreme readings on the SSR and any impending trend change. The metric, however, doesn’t consider the fiat-based trades or bitcoin derivatives and is not a perfect indicator.

Nevertheless, it has proved to be a reliable indicator of changes in the past.

For example, bitcoin’s previous bull runs, including the one seen in the final quarter of 2020, kicked off with a below -2 reading on the oscillator. So, the recent recovery could be a signal of an impending change of fortunes for bitcoin and broader crypto markets.

Bitcoin is currently trading near $31,789, representing a Key Indicator Shows Renewed Inflow Of Capital Into Bitcoin8.47 percent drop in the last 24 hours. The leading cryptocurrency fell sharply in mid-May and has been restricted mainly to the $30,000 to $40,000 range ever since, barring the temporary dip to $29,000 earlier this week.

The market capitalization of tether (USDT), the largest stablecoin, has increased from $59 billion to over $64 billion in the past four weeks.

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Bitcoin

Bitcoin Bulls Run Amok: Short Traders Hit with $90 Million Loss Amidst Unstoppable Surge

Published

2 days ago

December 6, 2023

Investors King

The relentless surge in Bitcoin’s prices has left short traders reeling as highly leveraged futures bets against the cryptocurrency incurred losses totaling $90 million on Tuesday alone.

This follows an additional $70 million in short liquidations on Monday, contributing to Bitcoin’s remarkable climb from $39,000 to $44,000 this week.

According to data from CoinGlass, most of these liquidations transpired on major crypto exchanges, including Binance, OKX, and Huobi.

The substantial liquidation figures have the potential to signal either a local top or bottom in a significant price movement, providing valuable insights for traders looking to strategically position themselves.

The surge in trading volumes, up by 25% in the past week, coupled with the growth in open interest from $17.2 billion to $20.2 billion since the beginning of December, underlines the increased market activity around Bitcoin.

Several factors are contributing to Bitcoin’s recent growth. Optimism is swirling around the potential approval of a spot exchange-traded fund (ETF) in the U.S., with traders factoring in anticipated rate cuts, buoying riskier assets like technology stocks and Bitcoin.

Additionally, the possibility of sovereign adoption is gaining traction as leaders in major economies express a Bitcoin-friendly stance.

Over the weekend, a notable group of traders committed to a $200 million BTC futures position, emphasizing the sustained demand for exposure to Bitcoin.

Amid continuous updates and changes in spot ETF applications, some industry observers foresee Bitcoin prices surpassing the $48,000 level in the coming weeks, further intensifying the cryptocurrency’s bullish momentum.

Bitcoin

Bitcoin Surpasses $42,000 Mark, Ethereum Follows Suit, Triggering Crypto Rally

Published

3 days ago

December 5, 2023

Investors King

The price of Bitcoin (BTC) exceeded $42,000 for the first time since April 2022, a level unseen since the Terra market crash.

Concurrently, Ethereum (ETH) also experienced an upswing, surpassing $2,200.

Bitcoin had been hovering around the $40,000 level in recent days before finally breaching it and breaking $42,000 within 24 hours.

Ether mirrored this momentum, trading at around $2,240 with a similar percentage gain.

The positive movement in Bitcoin’s price resonated throughout the crypto market, influencing related stocks.

Notably, leading crypto exchange Coinbase (COIN) and tech company Microstrategy (MSTR) both saw nearly 9% increases in pre-market trading while crypto miners Marathon Digital (MARA) and Riot (RIOT) witnessed gains exceeding 10%.

However, BNB coin (BNB), linked to the Binance exchange, remained relatively stable.

Bitcoin’s value had dipped below $40,000 in April 2022, but recent months have seen a rebound, partly attributed to accommodative statements from U.S. central bankers and optimism surrounding a potential approval for a bitcoin exchange-traded fund (ETF) in the United States.

Amidst these developments, Bitcoin holders withdrew 37,000 BTC between November 17 and December 1, indicating a trend toward direct custody of assets.

Gold also reached a record high, surpassing $2,100 per ounce in response to Federal Reserve Chairman Jerome Powell’s dovish comments.

Analysts suggest that the market anticipates a potential rate cut in the coming year, contributing to growing investor bullishness on Bitcoin ETF applications.

As the crypto market aligns with gold’s movement due to lower yields, Bitcoin’s recent surge is seen as a bullish signal, with potential further upticks anticipated in the coming weeks.

Looking ahead, the market will closely watch U.S. ISM services PMI data and non-farm payrolls for December, with a strong NFP figure potentially impacting Fed rate cut expectations for 2024, which could influence Bitcoin’s ascent.

Bitcoin

Bitcoin Breaks $40,000 Price Levels Amidst Optimism and Regulatory Developments

Published

4 days ago

December 4, 2023

Investors King

Bitcoin on Monday broke $40,000 resistance levels following a 2.9% surge in price to $40,867 per coin.

The world’s largest digital currency has now appreciated by 146% in 2023 as more institutional investors continue to increase their investments in the unregulated cryptocurrency space.

Investors are exhibiting growing confidence in the Federal Reserve’s apparent conclusion of rate hikes amid a cooling inflation backdrop.

This shift in sentiment has redirected attention to the anticipated extent of rate cuts in the coming year, prompting a rally across global markets.

The cryptocurrency industry is currently in anticipation as regulatory decisions, particularly regarding applications for the first US spot Bitcoin exchange-traded funds (ETFs), hang in the balance.

Bloomberg Intelligence anticipates the approval of a batch of these ETFs by the Securities & Exchange Commission (SEC) by January.

“Bitcoin continues to be supported by optimism around SEC approval for an ETF and Fed rate cuts in 2024,” noted Tony Sycamore, a market analyst at IG Australia Pty.

Technical analysis points to $42,330 as the next significant level to monitor in Bitcoin’s upward trajectory.

Despite recent crackdowns in the industry, including legal actions against figures like Sam Bankman-Fried and Binance, Bitcoin has proven resilient.

Optimists argue that these regulatory measures, alongside the potential approval of ETFs, signify the maturation of the crypto industry and the prospect of a broader investor base.

According to Su Yen Chia, co-founder of the Asia Crypto Alliance, recent enforcement actions “have instilled confidence among investors,” noting that Bitcoin is aligning with momentum in traditional finance as expectations of Fed rate hikes fade.