What Analysts Say About Bitcoin Price Upsurge Above $7k
Yesterday, the price of BTC plunged by 3.5 percent to $6,850. However, it was able to stage a powerful retracement and gained $400, representing a 6 percent upsurge to $7,250 prior to returning to $7,200. It has been trying to stabilize its level at $7.2k since then.
Skew Markets, a crypto research and data company, noted the liquidation of a minimum of $16 million worth of short positions on BitMEX in this huge upsurge.
The upsurge startled many traders and caught them off guard, and analysts are now wondering why the price of BTC surged by 6 percent within minutes.
Due to the upsurge, Matthew Graham of Sino Global Capital tweeted, asking a question. He asked whether the movement of BTC is a reaction to geopolitical risk.
Do we think bitcoin is moving in reaction to geopolitical risk? Fascinating.
— Matthew Graham (@mg0314a) January 3, 2020
The tweet of Graham is a reference to a report released some hours ago that the president of the U.S. ordered attacks on army leaders of Iran. The attacks led to the loss of very important Iranian military men. Hence, global markets are going comparatively berserk.
For example, crude oil surged by 3 percent while the price of gold quickly increased by $10 within minutes following the release of reports regarding the attack. As Bitcoin continues to become a macro asset according to some analysts, one may logically say that the potential of increasing conflict between the United States and Iran is influencing capital towards Bitcoin as well as other alternative assets that investors see as safe havens.
However, the renowned crypto analyst, Alex Kruger, is not convinced about this thesis. He tweeted following the upsurge, highlighting the likelihood of the thesis being an untrue narrative because the movement of BTC came hours following the move of other assets.
Talking heads will soon be discussing how bitcoin is a safe haven and is going up because of Iran. Which is absolute nonsense. Round numbers are there to get run over, in both directions. I have a small long so I'll be happy if speculators use the narrative to push prices up.
— Alex Krüger (@krugermacro) January 3, 2020
In conclusion, based on the data concerning Bitcoin futures mentioned earlier, this upsurge over $7,000 could be due to a short squeeze in these times of low volatility.
Featured image courtesy of Shutterstock. Source: Cryptopress.