Bitcoin continues to push upwards to close several daily green candles, which has a positive effect on the crypto market. Meanwhile, the benchmark cryptocurrency is trending upwards, with general sentiment turning into greed territory for the first time since May 2022.
At the time of writing, Bitcoin (BTC) is trading at $20,850 with a 1% gain over the past 24 hours and a 9% gain over the past week, respectively. Ethereum (ETH) and Dogecoin (DOGE) are the top 10 best performers by market cap on the same timeframe.
Is Bitcoin Rally Likely To Continue?
The bitcoin and crypto markets displayed a high correlation with traditional finance. However, the digital asset has been running contrary to the trend for the past few days.
While Amazon, Netflix, Apple, Meta and other big tech companies tanked due to lower earnings, bitcoin broke above a key resistance at $20,500. In that sense, the BTC and crypto markets closed in the green with the weekend.
With traditional markets closed, cryptocurrencies are free to make more profits. The bullish momentum was fueled by mistrust of traders and an upward push for Dogecoin and Ethereum.
The king of meme coins rallied this Friday after Elon Musk confirmed the acquisition of social media platform Twitter. Bullish price action in the crypto market has prompted many traders to open short positions, fueling any higher trend.
When highly leveraged positions are liquidated, the market may continue the trend. This status quo is likely to prevail over the weekend, but adverse conditions may prevail during the week. According to crypto analyst Justin Bennett:
The strong stock market this weekend may be reason enough for #Crypto. Throw in a big $BTC short liquidation over $21k, and you have one more reason. I am less optimistic about Monday though given that equities had closed on Friday (…). Shorts are still accumulating, and there are still a ton of liquidations above these highs. This pump most likely hasn’t been done yet.
If traditional markets rebound from last Friday’s levels, bitcoin and company will follow suit. A pseudonymous trader pointed to the on-balance-volume (OBV) indicator, a metric used to measure market momentum. The metric formed a double bottom and resumed its uptrend, indicating further appreciation.
— IncomeSharks (@IncomeSharks) 29 October 2022