Bitcoin prices rose sharply today, showing that bullish sentiment has returned to the digital currency markets.
“The bulls are back in charge,” said analyst Charles Hayter, who pointed to Bitcoin’s robust intraday gain and a short squeeze taking place on Bitfinex.
The world’s largest cryptocurrency reached $8,055.20, climbing almost 20% in less than six hours, CoinDesk Bitcoin Price Index (BPI) data shows.
[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.]
Bullish Sentiment Returns
Market data provided by major exchange Bitfinex helped illustrate the bullish nature of the market.
Buy orders for the BTCUSD pair accounted for roughly 57% of all orders during the 24 hours through roughly 3:15 p.m. EST, BFX Data revealed.
As Bitcoin’s price rose, the digital currency experienced a short squeeze, meaning that rising prices forced traders to close out their short positions, provoking a stronger rally.
“The short squeeze does signify a change in sentiment,” said Hayter, co-founder and CEO of digital currency data platform CryptoCompare.
Tim Enneking, managing director of Crypto Asset Management, also weighed in on the mindset of traders, stating that they have been experiencing “lower fear and increased risk appetite” lately.
Bitcoin Headwinds Die Down
Bitcoin prices have encountered several headwinds lately, including tax considerations and the decision of the Mt. Gox trustee to sell hundreds of millions of dollars worth of digital currency, noted David Johnson, CEO of Latium.
However, these bearish factors have weakened as of late, he stated.
This development has helped the digital currency rally.
“I believe the surge in bitcoin price is connected more with decreased selling pressure than anything else,” said Johnson.
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