The most popular cryptocurrency, bitcoin just gave another example of the recently increased volatility.
After suddenly spiking above USD 9,000 for around 10 minutes on Thursday evening (UTC time) it dropped and after five hours it was already below USD 8,200. At pixel time (05:40 UTC), bitcoin trades at around USD 8,204, or 6% less than 24 hours ago.
Bitcoin price and volatility:
The aggressive rising trendline we've been tracking (yellow line) is now broken.
We could redraw the line to include yesterday's prices but I'd rather not.
Psychological support (white) is holding at $8,000. If it does break, the next major support is $6,400. pic.twitter.com/DdYxhBpj1G
— Mati Greenspan (@MatiGreenspan) May 31, 2019
Meanwhile, other major coins from the top 10 have also followed the suit and are down by around 10%, while bitcoin SV crashed by almost 19%. The absolute majority of the top 100 coins by market capitalization are also in red.
At pixel time, only tokens such as monacoin, maximine coin, cosmos, hypercash, and bytecoin are in green. However, majority of coins out of the top 100 still kept their weekly gains, ranging from 1% to 93% (bitcoin sv).
As reported, bitcoin sv almost doubled in value yesterday on fake-news spreading in China. However, the price crashed by 25% later.
Top 10 coins by market capitalization:
- On consolidation: billionaire Bitcoin bull and CEO Galaxy Digital Holdings, a crypto-focused merchant bank, Michael Novogratz estimated that “On a go-forward basis, bitcoin probably consolidates somewhere between USD 7,000 and USD 10,000," Bloomberg reported. And if he’s wrong, he’s wrong "to the upside, that there’s enough excitement and momentum that it could carry through."
- On rally drivers: Bart Smith, head of digital assets at Susquehanna, a global quantitative trading firm, told CNBC that, among other things, the crypto rally was driven by the ongoing trade war between the U.S. and China, as "bitcoin was either a hedge or just an outright way to get capital outside of [China]." As reported yesterday, if the trade war spreads into the US bond market, China can start selling-off US Treasuries, which might in turn make certain cryptos soar. Also, according to Smith, “there’s a tremendous optimism about online brokerages offering bitcoin to retail customers in 2019.”
- On bitcoin adoption: "Bitcoin economic activity continues to be dominated by exchange trading," Kim Grauer, senior economist at blockchain analysis firm Chainalysis, told Bloomberg, adding that this suggests "Bitcoin’s top use case remains speculative." Transactions related to exchanges accounted for 89.7% of all Bitcoin activity between January and April of this year, down only slightly from 91.9% for all of last year, according to Chainalysis. However, as reported by Cryptonews.com, even preliminary numbers, based on data gathered from twenty merchant service providers, show that in January 2019 more than BTC 32,300 were spent, or 47% more than in January 2018. Nevertheless, USD value of bitcoins received by merchant services in January dropped by 70%.