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Bitcoin Price Skyrockets Past $63,000: 3 Key Reasons
Over this past weekend, Bitcoin (BTC) experienced a significant rally, pushing its price above $63,000âan increase of 5.6% since bottoming below $60,000 on Friday. This unexpected spike occurred even though there was no major news story to trigger it, giving rise to speculation and analysis regarding the underlying cause. Here's an in-depth look at three key factors that might explain this weekend's price movements.
1) Mysterious Bitcoin Whale Activityâ
According to DeFi^2 (@DefiSquared), the number one ranked trader at Bybit and leading wallet at DeBank, mysterious âwhalesâ have been active in Binance's perpetual futures market. DeFi^2 noted significant buying activity from these entities, stating, âSince local BTC bottomed on Friday, almost the entire bounce this weekend came from a single entity on Binance Perps that has made over $450 million in purchases across the 500 BTC blocks at a time. time during the hours of lowest liquidity in the market.â
The DeFi^2 analysis fueled speculation about potential whale strategies, especially considering the distribution of Mt. The upcoming Gox, which may further affect Bitcoin's liquidity and price stability. He explained, âCurious what the end result will be before Mt Gox distribution begins. With a position this big, to get out, they would have to run the market at a price high enough to cause a short squeeze, or end up being a big risk if the market goes against them.â
2) Increased Open Interest âïž
Crypto trader Daan Crypto Trades (@DaanCrypto) provides insight into how the futures market contributes to Bitcoin price movements. The focus is on the relationship between open interest and market price, which is an important indicator of market sentiment and potential future volatility.
âDuring this bull run, we have mostly seen Open Interest rise with a bit of short-term pressure and some long-term profit taking in between. I think there are a lot of underwater holes in the ~$60K region that need to be eliminated if the price is to continue to climb higher. That $65K area is still a big area to watch,â Daan wrote.
Interestingly, open interest in Bitcoin increased from $30.97 billion on Saturday to $32.21 billion on Monday, according to data from Coinglass. Even though there was an increase in open interest, at the weekend there was no significant decline. Liquidations of just $35 million in BTC shorts during this period were relatively modest compared to previous events, such as on May 20 when a price spike from $66,000 to $71,500 resulted in short liquidations of $84.2 million.
3) Technical Breakthrough đ
Another contributing factor is likely a technical breakthrough in Bitcoin, which shifted market momentum. Popular crypto analyst CRG (@MacroCRG) described the weekend price movement as âthe beauty of a breakout.â He highlighted that funding rates and the basis of perpetual futures contracts remained flat, which usually precedes strong market moves.
âThat's the beauty of breakthroughs. Funding + fixed actor base. Weekly close in 1 hour + weekly candle is a very large pinbar with 8% wick (high probability reversal candle). "The shipment is full," he said.
Technical analysis shows Bitcoin breaking through a descending trend line that has been in place since peaking at around $72,000 in early June. A breakout of this trend line on the Binance 4-hour chart, as noted by CRG, signals a potential reversal of the recent bearish trend.
Additionally, BTC's weekly close presented a significant bullish signalâa large pinbar candle with an 8% wickâindicating a potential upward move.
At press time, BTC was trading at $63,232.
Then it's all in your hands to see the luck of the market $BTC now. just smile.
