Bitcoin prices rallied this morning, and have managed to retain their gains since then. (Photo by … [+]
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Bitcoin prices climbed nearly 8% in an hour today, rising in value as they were bolstered by a range of bullish factors.
The world’s most prominent digital currency was driven higher by “a perfect storm,” according to market analyst Denis Vinokourov.
“A combination of positive network fundamentals in the form of mining difficulty adjustment and a strong showing by the hashrate since correcting lower in March, together with technical price formation above 50DMA and aggressive stop loss hunting through $7,500, sent Bitcoin soaring all the way to $7,800 level,” said Vinokourov, head of research for London-based digital asset firm Bequant.
Other market observers agreed, noting that multiple price drivers helped fuel bitcoin’s gains.
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
As a result of these developments, the digital asset climbed from $7,165.22 at roughly 9:30 a.m. EDT to $7,725.67 around 10:20 a.m., a gain of 7.8%, CoinDesk figures show.
Since that time, bitcoin has been trading mostly between $7,500 and $7,600, additional CoinDesk data reveals.
Going forward, the digital currency could be headed for additional gains, noted Vinokourov, who highlighted specific market factors.
“Futures contracts trading at a premium to spot prices (known as contango) supports the notion of further upside,” said Vinokourov.
Kiana Danial, CEO of Invest Diva, supported this optimistic assessment with some technical analysis.
“Bitcoin has just broken above the daily Ichimoku cloud, with the future cloud turned bullish,” she stated.
While Danial described this as “a bullish indication,” she noted that “we could see a temporary pullback in the coming days as it has already hit the resistance level of $7,746 which falls on the 38% Fibonacci retracement level.”
“From there, as the Ichimoku cloud continues to act as a support, we could see further gains above $8,000 towards the end of the month.”
Joe DiPasquale, CEO of cryptocurrency hedge fund manager BitBull Capital, also weighed in.
“We saw BTC’s price finding support at the 50-day moving average for the last three days, which gave it the confidence needed to breach the resistance at $7,300 and almost test the 150-day moving average resistance today, which currently stands at roughly $7,800,” he stated.
“Moving forward, however, it is likely that we will see a pullback towards $7,300 – $7,200 and consolidation in this range before Bitcoin can rise above the 150-day moving average, which can pave the way” for a push toward $9,000.
Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether and EOS.
