Bitcoin Crosses $21,000 Canadian for the First Time Since 2017
It’s official! Bitcoin is booming! It’s been nearly three full years since a single Bitcoin was worth $21,000, and yet, here we are again. Joe Biden is officially the President-elect in the United States and the crypto markets clearly like the fact that the election is over and the dust appears to be settling. It’s also very likely that Biden approves a new stimulus package for Americans in January, meaning that more money will be poured into the market. But there are also three more specific investing related reasons for the recent pump in price outside of macroeconomic or political factors.
The Derivatives Market Is Being Propped Up
Just 48 hours ago, investors took Bitcoin on a short ride down by about $1300-$1400. That drop was enough for investors to reallocate their funds in the derivatives market and prop up the price again. This makes the possibility of another short-term drop unlikely. This most recent drop actually flushed out a lot of investors who were late buying into contracts and decided to take a small loss rather than hold on for a long-term gain.
Bitcoin’s Price Is Pushing through a Large Number of Sell Orders
This past weekend saw a large number of sell orders get triggered by investors taking profits. That usually leads to a bigger dip in the market but the price is bouncing right back up even until late last night. This means that resistance at the $21,000 mark is now weaker. As the price bounces both under and above that benchmark, it’s more and more likely to solidify above $21,000 as resistance turns into support.
Whales Are Keeping the Boat Afloat
Whale investors moving large amounts of capital into Bitcoin are much less likely to sell their positions if they made their investment at a price they are happy with. Recent data shows that a major level of support exists at around $19,500. Any short-term drop in price will probably be halted at that level because bitcoin wallet addresses holding large amounts are going to make a rash decision and leave Bitcoin behind.
How to Invest in the Next Bitcoin Boom
All signs point to the fact that Bitcoin likely isn’t going down much further in the short term. Register for a free account at Netcoins.ca so that the next time investors are rushing to a cryptocurrency exchange in Canada to get in on the bonanza, you’re early to the party.
Writer, content marketing at Netcoins.