Home Coins Ethereum (ETH) 3 reasons Bitcoin price just hit $11,000 despite altcoin stagnance

3 reasons Bitcoin price just hit $11,000 despite altcoin stagnance

Within the last hour, the price of Bitcoin (BTC) surpassed $11,000 across major exchanges, including Coinbase and Binance. This comes after nearly two weeks of low volatility as the cryptocurrency market remained stagnant and Bitcoin price was pinned below multiple resistance levels.

BTC/USD daily chart. Source: TradingView.com

BTC/USD daily chart. Source: TradingView.com

Unlike the previous rallies which saw Ether (ETH) lead the Bitcoin upsurge, only BTC has moved higher whereas other major cryptocurrencies are still in the red. Decentralized finance (DeFi) tokens, which outperformed BTC throughout August, have been underperforming in the past several days.

Negative funding rates

The recent uptrend of Bitcoin has many irregular patterns compared with previous uptrends. BTC has been rallying on its own in the past three days, accompanied by negative funding rates.

Funding is a mechanism used by Bitcoin futures exchanges to ensure balance in the market. If the majority of traders in the market are betting against an asset’s price by shorting, then short contract holders have to compensate long holders. The inverse of this process applies when traders are long on an asset.

Bitcoin funding rates on Skew show that the funding rates still remain mostly negative across major exchanges and this indicates that traders are continuing to short BTC despite its upward movement.

The data suggests three possible trends: shorts are being squeezed, the spot market leading the rally, or futures are having a minimal effect on BTC price.

According to TradeLayer founder Patrick Dugan, BitMEX is falling behind in liquidity compared to the levels seen in March. The open interest of futures exchanges has declined in recent weeks, suggesting that futures activity has declined.

Various data points also hint at the spot market leading the current rally. If the demand from the spot market is behind the rally it is considered an optimistic trend.

When the futures market causes BTC to increase, it often causes the market to become vulnerable to long squeezes. But if the spot market is pushing BTC up, the chances of a big long squeeze causing a massive correction is low.

$11,000 remains a resistance level

Still, it is premature to expect an extended rally from $11,000. Traders have pinpointed the $11,000-$11,300 area as a major resistance range. There is a high probability that a rejection could happen, and $10,100 and $10,500 remain as key support levels.

On Sept. 15, Michael van de Poppe, a full-time trader at the Amsterdam Stock Exchange, said that breaking $10,900 would likely result in $11,300. He said:

“Levels to watch on $BTC. Breaking $10,900 -> $11,300 next. Losing $10,600 -> $10,300 next.”

But, a major BTC rally above $11,300 is difficult to project based on its recent performance. After its steep fall from $12,500, the $11,300 level solidified as a resistance level.

The Fed meeting

The Bitcoin upsurge also coincided with the recovery of gold and the intraday rally of the U.S. stock market. The simultaneous uptrend comes as the Federal Reserve hosts a meeting to decide interest rates.



Source link

Mr Bitcointe
Mr Bitcointehttps://www.bitcointe.com/
“Fact You Need To Know About Cryptocurrency - The first Bitcoin purchase was for pizza.” ― Mohsin Jameel
474FansLike
76FollowersFollow
4,567FollowersFollow
5,261FollowersFollow
1,579FollowersFollow
2,230SubscribersSubscribe
USD - United States Dollar
EUR
1.19
GBP
1.30
CHF
1.10
NOK
0.11
JPY
0.01
CAD
0.76
AUD
0.73

Most Popular

South Korean Police Seize Shares From Major Bithumb Shareholder

South Korean police have seized shares in Bithumb, the country’s biggest crypto exchange. The shares belong to Bithumb Korea director and major...

ERC-20 token’s market cap overtakes Ethereum’s

The latest findings by Santiment, published in Cointelegraph Consulting’s biweekly newsletter, suggest that Ethereum is temporarily being ‘professionalized’. Since the September 2nd market crash, the...

GPU Manufacturer Nvidia Buys Chip Maker ARM for $40 Billion

California-based Nvidia is buying British computer chip designer Arm Holdings from Softbank Group Corp. in a deal worth $40 billion.Nvidia, which specializes in...

Timers’ Ongoing IPM Presale Will Help Tackle Challenges of the Next Industrial Revolution

For the first time in history, a human’s intrinsic ‘time value’ is being used as a currency for trading, as IPM is...
bitcoin
Bitcoin (BTC) $ 10,976.62
ethereum
Ethereum (ETH) $ 386.10
ripple
XRP (XRP) $ 0.253811
tether
Tether (USDT) $ 0.999299
bitcoin-cash
Bitcoin Cash (BCH) $ 236.54
bitcoin-cash-sv
Bitcoin SV (BSV) $ 163.59
litecoin
Litecoin (LTC) $ 48.81
eos
EOS (EOS) $ 2.74
binancecoin
Binance Coin (BNB) $ 28.19
okb
OKB (OKB) $ 6.20
tezos
Tezos (XTZ) $ 2.51
leo-token
LEO Token (LEO) $ 1.19
cardano
Cardano (ADA) $ 0.093375
monero
Monero (XMR) $ 93.65
stellar
Stellar (XLM) $ 0.079783
chainlink
Chainlink (LINK) $ 10.86
huobi-token
Huobi Token (HT) $ 4.88
tron
TRON (TRX) $ 0.029403
usd-coin
USD Coin (USDC) $ 1.00
dash
Dash (DASH) $ 73.24
neo
NEO (NEO) $ 25.21
iota
IOTA (MIOTA) $ 0.276727
nem
NEM (XEM) $ 0.104034
zcash
Zcash (ZEC) $ 59.29
maker
Maker (MKR) $ 498.39
paxos-standard
Paxos Standard (PAX) $ 1.00
ethereum-classic
Ethereum Classic (ETC) $ 5.19
vechain
VeChain (VET) $ 0.014188
true-usd
TrueUSD (TUSD) $ 0.999454
ftx-token
FTX Token (FTT) $ 3.92
kucoin-shares
KuCoin Shares (KCS) $ 1.20
waves
Waves (WAVES) $ 2.50