In lower timeframes, Bitcoin is range-bound, trading around $54,277. On one daily chart, the leading cryptocurrency by market valuation gets nearly nothing, but on other 7-day charts, the crypto gained a staggering 24%.
The market’s general mood has shifted to positive, as investors appear to be anticipating greater gains in the fourth quarter this year, a traditionally bullish quarter.
Bitcoin’s recent rebound to the mid-$50,000 range, according to investment company QCP Capital, was the result of a “short squeeze.” The strong rise to the upside was sparked by a large number of short position liquidations on Chinese crypto exchanges, QCP said.
Significant buying of crypto
Furthermore, QCP discovered that institutions were behind the $50,000 Bitcoin reclaim, as evidenced by a surge in open interest on the Chicago Mercantile Exchange (CME) and an increase in the premium for these futures versus the price of bitcoin in the spot market.
“The extremely high premium indicates that there has been a flood of outright purchases. Both of these indicators lead us to conclude that there has been significant institutional buying of bitcoin in the last seven days,” according to QCP Capital.
Additional factors, according to the investment firm, appear to have favored Bitcoin bulls, including the evaporation of uncertainties surrounding Chinese real estate developer Evergrande, the very likely acceptance of bitcoin exchange-traded funds based on CME Futures, and BTC obtaining more reputation as a viable investment instrument.
Further gains seen
Meanwhile, according to a separate report from investment firm CoinShares, three factors are expected to drive further gains in the fourth quarter: legislation, adoption, and the macroclimate.
Bitcoin bulls have previously had some, but not all, of these three elements working in their favor, the research shows, because of statements made by the Federal Reserve and U.S. Securities and Exchange Commission on cryptocurrencies.
With regards to regulation, CoinShares said the U.S. is “starting to warm to crypto” because of certain statements issued by the two U.S. agencies on crypto.
Image courtesy of Cointelegraph News/YouTube
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