Bitcoin has been having a great year so far for the first month of 2020, up 28.6% since the first of January. The daily chart is looking bullish, and a golden cross is forming, but Bitcoin hasn’t crossed the 10K mark, yet. Let’s take a look at why that may be.
Bitcoin bulls have been optimistic for the new year, and the market shows it. The market’s leading cryptocurrency is up almost 30% since the beginning of the year. The recent bull run has run into resistance just shy of the psychologically important $10,000 dollar level.
1. $9,580 resistance creating strong selling pressure
One of these reasons may be the strong rejection Bitcoin faced at the October high of $9,580. Bitcoin recently broke out of a 7 month long downward channel, but it has yet to capture a higher high than the high of last October, and faced strong selling pressure when testing this price point.
The $9,580 is a particularly strong resistance that pushed back bulls during last year’s October rally, as BTC bulls attempted to break for the five figure level above. This will require a significant amount of bullish momentum to break, and is likely to create some short-term issues for bitcoin’s price action.
2. Tesla’s bull run may be casting a shadow over Bitcoin
Another factor may be that Tesla, Elon Musk’s electric car company has been stealing attention away from Bitcoin. It seems investors may have pulled their BTC capital and re-allocated it to Tesla to capture some of the value creation from its exciting run.
Right now, TSLA is pulling ahead of BTC gains, with analysts predicting Elon Musk’s company could see stock price balloon as high as $6,000 per share by year-end.
3. Bakkt Option volume has been zero for days
It's been 10 days since the last option trade on Bakkt 💤 pic.twitter.com/1xYiylC8fr
— skew (@skewdotcom) January 28, 2020
Institutional traders have not shown any interest in trading Bitcoin futures, if Bakkt option volume is any indicator. The Bakkt exchange is geared towards institutional Bitcoin futures traders who want to trade a contract physically settled in Bitcoin. The exchange has terribly low interest right, and volume has been zero for over ten days now. This may be a sign that Bitcoin markets might be cooling down a bit.
Do you think Bitcoin can cross 10K in next few days? Let us know in the comments!
Images via Shutterstock, Twitter @skewdotcom @