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The cryptocurrency market ended the previous trading week on a strong positive. Elon Musk revealed SpaceX's investment in bitcoin, BTC broke the $33,000 mark, and the FTX crypto derivatives exchange attracted a historic $900 million investment. The new week began for the cryptocurrency market with a powerful bullish breakout. Bitcoin rose 11% and broke through the $38,000 mark for the first time since mid-June. Due to the powerful upward movement, an unspecified number of bears were forced to return to their dens until better times.
As we have already noted, the growth of BTC indicators did not guarantee the growth of asset quotes, since the two-month depression in the market changed the psychology of the players. The number of bears in June and July continued to grow, and the market did not believe in a bullish outcome of this situation. However, as is often the case, the bottom line was in contrast to the market sentiment. A similar scenario of the development of events already took place in the spring, when large players manipulated the market through large volumes of coins.
A similar situation happened with the bears, which bet the asset on a further collapse in quotes. As a result, a sharp jump in the value of bitcoin caused the forced elimination of shorts, which were concentrated along a wide line of fluctuations. The total losses of traders per day amounted to $1 billion. Over 102,000 positions were liquidated, of which 88% were shorts. The largest loss per trade was $29.3 million. In total, traders lost $850 million due to bearish sentiments in relation to bitcoin.
As of 10:00 UTC, the cryptocurrency has confidently consolidated above the round mark of $38,000. The asset continues to consolidate the price in this area, and the convincing local dynamics of the price growth indicates the success of this event (+1.2%). The cryptocurrency managed to expand its audience and social activity, thanks to which the daily trading volume increased to $39 billion. However, there is every reason to believe that a large percentage of manipulative audiences has entered the market, which may be eliminated after the next rebound.
In general, the asset has formed a positive indicator of the price change for the week (+20%) and is moving towards the retest of $40,200, where the main resistance zone is concentrated. If the coin manages to break through this milestone and break out ahead, then the final chord of bearish ambitions will be the breakdown of the $46,000 mark.
The main technical indicators of bitcoin indicate the continuation of the upward movement. Right now, the market is undergoing a strong impulse, which is reflected in the increased volumes of daily trading and the RSI indicator, which is above 80. At the same time, the MACD is high above the zero level and is moving confidently upward. The Stochastic Oscillator is one step away from the formation of a bullish crossover, while the fear and greed index is gradually moving towards the green zone. If the current market sentiment persists and the number of skeptics continues to decline, then bitcoin has every chance of ending the bearish period in the cryptocurrency market.
In addition to the surge in activity, BTC/USD quotes managed to make such a powerful breakthrough thanks to the local news background, which encouraged investors. First of all, the market players were influenced by the meeting of the main influencers of the cryptocurrency market: CEO of Tesla and SpaceX Elon Musk, CEO of ARK Invest Cathie Wood, and Twitter CEO Jack Dorsey. The said meeting became a kind of summing up of a certain stage of the development of the crypto market and, in general, produced a positive effect. Elon Musk announced the imminent resumption of the use of bitcoin as payment for the carmaker's products due to the increased environmental friendliness of the mining industry. Jack Dorsey announced the large-scale introduction of the first cryptocurrency into the Twitter infrastructure. Cathie Wood did not lag behind her colleagues and expressed confidence that over time BTC will become more environmentally friendly than the traditional sector of the economy.
Also, do not forget about other fundamental factors that cause a relatively high interest in bitcoin. The global economy continues to recover from the effects of the COVID-19 pandemic, and the demand for risky assets continues to be high. Moreover, the ability of bitcoin to hedge risks also remains in demand, especially now, with a gradual transition to the growth phase. If the market does not experience a powerful bearish impulse comparable to the ban on mining in China, the market will continue to develop a bullish mood. However, the question of setting new historical highs will only be possible when bitcoin is beyond 45,000, which now looks like a bit of an adventurous statement.
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