Bitcoin (BTC) has incurred a significant amount of volatility as of late. This tumult was perpetuated yesterday due to news regarding the release of Bakkt’s physically-settled Bitcoin futures product, which many investors view as a bullish development for the broader cryptocurrency market.
In addition to this, growing interest from China may help the Bitcoin price climb higher in the coming months.
Bitcoin Stabilizes Above $10,300 After Recent Recovery
At the time of writing, Bitcoin is trading up over 1% at its current price of $10,330, which marks a significant recovery from its recent lows of roughly $9,500 that was set earlier this past week.
Despite the strong recovery from the bout of capitulation that sent BTC to its weekly lows, a number of analysts still believe Bitcoin’s technical formations point to further downside in the near future.
This theory may be supported by a gap in the CME Bitcoin futures chart, which currently sits at $8,500.
Related Reading: Bitcoin Space Reacts to Bakkt’s September Launch Date Reveal
Despite this, Alex Krüger, an economist who focuses primarily on cryptocurrencies, explained in a recent thread of tweets that there is no guarantee that the gap will ever be filled.
“Even though gaps often fill, gaps are not meant to be filled. Gap filling is a combination of random variations (price moves), self-fulfilled prophecy (traders assign value to gaps), and lack of support/resistance within gaps (i.e. no trades inside),” he explained.
3/ Even though gaps often fill, gaps are not meant to be filled. Gap filling is a combination of random variations (price moves), self-fulfilled prophecy (traders assign value to gaps), and lack of support/resistance within gaps (i.e. no trades inside).https://t.co/NvE3JDTZQv
— Alex Krüger (@krugermacro) August 17, 2019
Will Positive Factors Help BTC Buck Recent Downtrend?
Assuming that a drop to $8,500 is not imminent, it is important to note that the markets have incurred robust fundamental developments as of late, which may help it reverse its recent downtrend and begin climbing higher.
Krüger further noted that there have been multiple bullish developments as of late that could help Bitcoin reverse its recent downtrend.
“Positive factors: Bakkt coming online Sep/23. Fidelity, Ameritrade, ETrade (awaiting news), HNWI & Macro traders interest. Macro narratives (false, but who cares). Retail interest trending (though still low). (Chinese interest in particular tripled in 2019, see,” he explained while referencing the below chart.
15/ Positive factors
Bakkt coming online Sep/23
Fidelity, Ameritrade, ETrade (awaiting news)
HNWI & Macro traders interest ⬆️
Macro narratives ⬆️ (false, but who cares)
Retail interest trending ⬆️ (though still low)(Chinese interest in particular tripled in 2019, see ?) pic.twitter.com/KJ6NlfkG3F
— Alex Krüger (@krugermacro) August 17, 2019
Assuming that the aforementioned fundamental factors, in combination with growing interest from China, helps Bitcoin reverse its recent downtrend, it is likely that $12,000 will be the next major level of resistance.
Featured image from Shutterstock.
