Is Spring bringing some volume or is USD Tether responsible for the pump?
The past two weeks have shown an increase in volume for bitcoin trading on most exchanges. Despite this, trading activity had been declining for a fortnight. However, the past two days have indicated a volume descent — so what must one think of this bounce?
The possible catalyst for traders to gain back their confidence was the breakout of bitcoin’s two-week long falling wedge — a typical bullish reversal pattern, which was signalled by an increase in volume on Sunday and Monday. Is this positive sentiment enough to push bitcoin upwards of the next resistance, which stands around £6.7k ($9.4k)?
Some say the fact that £215M ($300M) in USD Tethers were issued yesterday suggests the current investigations on the company behind the polemic stable token haven’t found any wrongdoing and thus, are ‘unimaginably bullish’. Such controversy definitely fuelled fears, which may have complemented the past months bear market. One thing is clear, the market reversal commenced on Sunday yet, the issuance of USD Tether happened on Tuesday. Therefore, this may have showcased that Tether actually needed to grant more tokens to back new deposits, as it hadn’t done so since January.
The volume isn’t convincing yet and this may be due to several factors. Some suggest using alternative indicators such as ‘On Balance Volume’ to better analyse the trend reversals, as volume can be manipulated. Conversely, others are saying USDT is possibly playing a role in the market upswing. So, what to really think of this bounce?
Well, for today some popular day traders are hinting bitcoin will drop and they are getting ready to short it. On the contrary, it’s also interesting to note that several alternative cryptoassets are exhibiting reversal patterns — namely the ‘falling wedge’, which has even been called the ultimate crypto trading pattern!
With regards to the rest of the market, over the past 24 hours, the top 100 projects have risen 10% on average — following bitcoin’s 6.5% rise. QTUM, featured in yesterday’s report, managed to stabilise with a 0.2% growth — a positive sign which is indicative of the fact that it wasn’t victim of a pump and dump scheme following the trading contest.
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