We are going through very different times. Bitcoin price rose above $ 48,500 just hours after seeing a massive drop to about $ 43,800 and reached an all-time high.
BTC has increased by 11.2% in the past 21 hours, recovering in a strong V-shape in a short time.
There are three main factors behind the Bitcoin rally reaching a new record.
3 reasons for the last bitcoin record
First, Bitcoin's market structure was not that downward when it began to consolidate above $ 44,000.
Scott Melker, a cryptocurrency trader known as "The Wolf Of All Streets," said before the rally, Bitcoin's technical structure was not bearish.
After consolidating just one day, Bitcoin exploded again, forming a new bull trend after rising above the bull flag seen above.
Second, there was positive news everywhere, with BNY Mellon entering the cryptocurrency market and Mastercard allowing traders to receive crypto payments.
The two announcements resulted in further improvement in market sentiment about Bitcoin, which was already at a high point after Tesla's $ 1.5 billion purchase of BTC.
Third, BTC was showing signs of a new rally after stablecoin inflows to the exchanges continued to rise.
When stablecoin inflows to exchanges increases, this indicates that marginalized capital returns to the Bitcoin market.
Alongside this, analysts revealed that the Coinbase premium has risen significantly, indicating increased buyer demand.
Lex Moskoviski, an analyst and quantity trader, said:
“Coinbase Premium reached almost $ 500 just two hours ago. This is even bigger than FOMO of Tesla Bitcoin news. By the way, I don't see any important news yet. Is something coming? "
Can BTC continue to rise?
Since Bitcoin is at an all-time high, it is important for Bitcoin to consolidate over $ 48,000 in the foreseeable future.
Technical analysts stated that the $ 48,000 level was a large number of stacked sell orders on Binance and other major exchanges, preventing a smooth breakout.
So when the $ 48,000 level is breached cleanly, the price of BTC will likely move towards the $ 50,000 area.
One concern may be that Bitcoin's funding rate hovers around 0.2% on top futures exchanges. When the futures funding rate is this high, this indicates that the market is overcrowded, the probability of a long squeeze increases.
The long squeeze can cause a sharp retracement in a short time, lowering the momentum of BTC while overly leveraged long positions are quickly resolved.
If the market is not zeroed, there is a risk of mass liquidation in the market in the near term.
The information in the content of the article is for informational purposes only. It does not constitute any investment advice.