Bitcoin is pushing higher after a correction of $ 300-400 on Sunday morning. The leading cryptocurrency is currently trading at $ 10,400 at the time of writing this article, about $ 200 from its lows.
This comes after the leading cryptocurrency pushed a crucial weekly candle that closes above USD 10,000. $ 10,000 has long served as a major horizontal level for Bitcoin, with three separate highs in the past year.
Analysts think Bitcoin’s ongoing rally may have legs, despite it being so nascent and relatively small.
One sign that this is the case is the altcoins price action.
A lot of altcoins, especially those in the DeFi space, are breaking out and overcoming the highs they set before Sunday’s fall. This suggests buyers have re-entered the market, seemingly in response to the strength in old markets.
Related Reading: Here’s Why This Crypto CEO Thinks BTC Will Hit $ 15,000 Soon
Why Bitcoin Is Ready To Press Higher
One reason Bitcoin is poised to move up the ladder is due to positive trends in the derivatives market. A trader recently shared the chart below after the decline on Sunday morning, noting that the correction allowed Bitcoin to tap into key liquidity zones around $ 10,300:
As usual, the liquidity level is where it is. Liqs are included, price drops. We just took some liquid again. I can see this going up again from here, otherwise it might dump a little further to 10100. This move feels like a classic shakeout by the way. You should also follow this man if you want to know what a real whale thinks. “
Chart of BTC's price action over the past few days with analysis by crypto trader Byzantine General (@Byzgeneral on Twitter). Chart from TradingView.com; custom indicators that show liquidity levels from HyBlock Capital.
Besides the expectation that Bitcoin will rise soon, are the funding rates. The funding rate is the fee that long positions pay for short positions in a perpetual futures market to ensure that the price of the derivative is the price of the spot.
Negative funding rates are now dominant in the crypto market due to the tremendous selling pressure on derivatives platforms.
This suggests that Bitcoin could bounce soon.
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Legacy Market Rally can help
A rally in the legacy market could support the crypto market’s recovery.
Alex Kruger, a macro analyst and economist, recently shared that there is a macro factor that is causing old markets to skyrocket:
It could have an obscenely green rocket start of the week. From Wednesday it will be up to the Fed to keep the party going. Quite a few IPOs this week could boost risk appetite. “
Bitcoin is likely to get higher if stocks do.
Could have an obscenely green rocket start of the week. From Wednesday it will be up to the Fed to keep the party going. A good number of IPOs this week could increase risk appetite.
– Alex (@classicmacro) September 14, 2020
Related Reading: It “makes sense” for Ethereum to decline at current prices: here’s why
Featured Image from Shutterstock Price tags: xbtusd, btcusd, btcusdt Charts from TradingView.com Does Bitcoin's Ongoing Rally Have Legs? Here's Why Analysts Think It Does