Bitcoin Erupts As Short Positions Are Wiped Out
https://cryptobriefing.com/bitcoin-erupts-shorts-wiped/So breaking 4,200 was it ? That's all we needed ?
5,500 at the end of the week ?
"Traders reacted to the news with cautious optimism. A few pundits suggested that the movement was led by bots, mistaking April Fool’s articles for real market sentiment.
In particular,
Finance Magnates published a prank announcement that the SEC had approved Bitcoin ETFs, an issue which has sparked strong price reactions in the past. Some think this explains why Bitcoin seems to be leading the charge.
But the market move came sixteen hours after the FM story was published. If April Fool’s articles had had any discernible effect on the market, as some have said, algorithmic traders would have reacted far faster to the news. It would have been a matter of minutes, not a whole day.
George Harrap, the co-founder and CEO of Bitspark, believes it was probably a “
natural move,” rather than a knee-jerk reaction by bots. Noting that Bitcoin is currently trading for $200 more on BitMEX than on conventional exchanges, Harrap suggests the movement was led by leveraged traders.
“This rules out any moves by local fiat exchanges or institutional influence,” Harrap wrote in an email. “It’s more of a natural move as compared with the price movements in 2018 where it seemed that too much was sold off.”
...
David Thomas, director of the crypto-brokerage firm GlobalBlock, argues that the price gained momentum due to technical trading.
$4,200 was a “key level” for Bitcoin, he explained, one which it had been unable to break this year.
Short traders identified this level, and calibrated their positions to exit at that price. When bitcoin broke past this morning, it triggered all the stops on short positions, removing resistance. This, Thomas believes, “exacerbated the move higher,” allowing Bitcoin to suddenly surge up to $4,800 within a relatively short space of time.
...
Thomas said
some bullish traders are already predicting BTC at $5,500 as early as this coming week."
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