Bitcoin News

Bitcoin Investors Gleeful at $13K Mark


Bitcoin bulls have one more reason to celebrate as the cryptocurrency reclaims $13k early in the morning on July 10th. After weathering a short but aggressive downturn in the price to the $9,700 level, they must have been relieved to see a strong recovery in the last few days. 

Analysts on both sides have been throwing predictions out for weeks now. The bears believe a larger market correction will occur, and the bulls are making lofty predictions for where Bitcoin will be at the end of next year. 

The past month has shown 69% growth in the price of Bitcoin and with the $13k mark having been broken through now, Bitcoin traders are now eyeing the $14k level. After this, there is minimal resistance before the $17k level, which is why investors are getting so anxious at this point. 

Traders are referring to the early-July drop in Bitcoin’s price as a “bear trap”. The price dropped sharply in what some were predicting to be a significant market correction, but was cut short when the price began to increase again. It is estimated that traders lost approximately $44 million just on BitMEX from betting on the price of Bitcoin continuing to decrease. 

Macroeconomic Factors At Play

Much of this price appreciation can be tied to the increased belief that the U.S. is about to head into a recession. Bitcoin is a natural hedge to a recession as it is generally uncorrelated or negatively correlated with the performance of the U.S. economy. 

Additionally, it seems like the U.S. is heading towards a currency war as President Trump has begun discussing the need for the Federal Reserve to print more money in order to match the actions of other currencies. On July 3rd, he tweeted: 

“China and Europe playing big currency manipulation game and pumping money into their system in order to compete with USA. We should MATCH…”

This would continue to devalue the currency, which is notable considering how much it has already been devalued over the last decade of quantitative easing. With negative interest rates already in play in some parts of the world, investing in Bitcoin becomes more and more appealing as situations like this unfold. 

The bigger lesson here is that macroeconomic trends are king when it comes to investing, and even cryptocurrency is largely affected – if indirectly – by government monetary policies. 

The Crypto Sector’s Current State

However, Bitcoin is outperforming other cryptocurrencies as much as it is beating equities. The current share of total cryptocurrency market capitalization (Bitcoin dominance) has reached a high of approximately 68%. 

Therefore, investors are buying Bitcoin more than they are buying any other altcoin. Normally, a strong correlation is seen between cryptocurrencies, so the Bitcoin dominance ratio stays relatively similar, but Ripple, Ethereum, Bitcoin Cash, and Litecoin are all currently trading down on the day. 

A similar pattern emerged in mid-2017 where Bitcoin was trading up a long time before the higher market capitalization coins began to shine. Perhaps we can expect the same events to occur this time, but until then, Bitcoin continues to dominate. 


Bitcoin Investors Gleeful at $13K Mark
5 (1 vote[s])

Add Comment

Investing is speculative. When investing your capital is at risk. This site is not intended for use in jurisdictions in which the trading or investments described are prohibited and should only be used by such persons and in such ways as are legally permitted. Your investment may not qualify for investor protection in your country or state of residence, so please conduct your own due diligence. This website is free for you to use but we may receive commission from the companies we feature on this site. Click here for more information.