The last couple of months have been quite stable in terms of the bitcoin (BTC/USD) price, but it seems like things are finally changing. Over the last few hours, the bitcoin price increased by over 15%, thus breaking the $4,200 technical resistance and hitting the $5,000 threshold. Once the upper price mark was hit, the price took a rapid fall – at the time of writing, the BTCUSD pair is trading at approximately $4,800.
BTCUSD Price Rally Caused by an April Fools Prank?
This last happened in November 2018, therefore price analysts and bitcoin enthusiasts throughout the world are attempting to determine what led to this uptrend.
anyone know any news? I have been asked "a few" times, but honestly clueless.
— CZ Binance (@cz_binance) April 2, 2019
Some believe that reasons are purely technical and directly linked to how the cryptocurrency market works, whereas others believe that an April Fools prank played by a cryptocurrency news website, encouraged the price swing. With this in mind, Finance Magnates posted a news article, stating that Bitcoin exchange-traded funds (ETFs) had finally been approved by financial regulators.
In fact, it seems like the U.S. Securities and Exchange Commission (SEC) is actually considering its ETF review decision again. Reports indicate that the next decision will be taken in May 2019. If bitcoin ETFs are approved, the event will likely lead to a lot of excitement on the market, alongside higher price swings.
Bitcoin Rise – Technical Reasons
Most analysts believe that there are other underlying reasons behind the price swing as well. For instance, an $80 million sell wall has reportedly been absorbed by the market when bitcoin was trading at $4,200. Additionally, BitMEX is dealing with a $415 million short cover for liquidations.
It seems as if today's massive bitcoin rally is simply technical and as soon as it broke $4,200, it just went surging up.
An $80 million sell wall (as reported by @Bleeding_Crypto) was absorbed at $4,200. Curious to see where this leads the crypto market.
— Joseph Young (@iamjosephyoung) April 2, 2019
Explanation for the bitcoin breakout 👇 Technicals matter. https://t.co/gA9HsWh1d4
— Alex Krüger (@krugermacro) April 2, 2019
After the bitcoin price increase, numerous other cryptocurrencies followed through. For instance, the ETH/USD pair hit $155, whereas EOS, Litecoin and XRP also saw a value increase.
It’s important to keep in mind that only two years ago, price swings like this were quite common. It will certainly be interesting to observe whether a new volatility trend will return on the digital currency market.