Bitcoin has climbed back to within touching distance of $8,000 in short order in what is a confirmation of buoyed sentiment in the market, helped overnight by Chinese and other Asian buyers.
Bitcoin is up 8% at $7,492, according to data and portfolio management site cryptocompare.
Binance Coin (BNB), Bitcoin Cash (BCH) and Dash (DASH) have all hit double-figures as the outperformers among the top altcoins.
Litecoin (LTC) was a notable laggard, actually fractionally lower by 0.25% at $87 at around 10.30 GMT but then jumped 7% to currently trade at $93.7.
XRP is catching a bid too, for a 7% advance to $0.404.
Asia, and China in particular, firing up market
The big movement in the markets happened in the Asia trading session.
That’s a further indicator of the rekindling of interest in China, where as the local currency falls against the dollar the price of bitcoin rises.
A report in the South China Morning Post quotes a researcher from Blockchain.com and the London School of Economics, noting that they have been intently following the you/renminbi against the dollar and its relationship with bitcoin, which shows a negative correlation. heres the quote from SCMP in italics:
Garrick Hileman, head of research at Blockchain.com and a researcher at the London School of Economics, said he and other analysts had been watching the movements of the two currencies.
“We are observing a strong inverse correlation between the RMB’s value and bitcoin, meaning that recent RMB declines over trade tensions have been closely matched by increases in the value of bitcoin,” he said using the short form of the Chinese currency’s official name, the renminbi.
“We can’t be 100 per cent certain that bitcoin’s recent price increase is being driven by concerns over the trade tensions and declines in the RMB’s exchange rate as correlation does not necessarily equal causation,” Hileman said.
Capital flight is taking hold, albeit at low levels that will not be worrying Chinese officials just yet. However, the part played by bitcoin may be.
Without shutting down the internet it is difficult to see how such movements could be totally stopped.
Certainly, anti-bitcoin laws could be introduced forbidding involvement in any shape or form in the market, but the determined would always fin a way, especially with the widespread familiarity with VPN tools in the country.
But the dips the new normal
The sharp bounce of the lows between $6,200 and $6,400, depending on which exchange prices you go by, could act as a forward signal to buy the dips.
Although there will be some disappointed that the price has recovered so quickly because they were looking to accumulate at lower levels, there will undoubtedly be more pullback opportunities, albeit at higher levels.
$8,400 is now the key resistance for the bitcoin price as it seeks to make better progress on the road to 10k.
The bullish range shaded in the cart below indicates that when resistance at $8,400 is pierced, there will be rapid march towards $10,000