Markets report bitcoin price
Bitcoin,  Markets Report,  Opinion

Markets Report: Bitcoin circles $13,000 as amid fresh rumors of more firms buying BTC

Bitcoin’s best week in over a year shows no signs of reversing its fortunes as $13,000 stays in sight

Bitcoin spent another day challenging $13,000 on Oct. 23 as the aftermath of its rapid run to 15-month highs continued to excite investors.

The past week has seen some of the most successful trading days in Bitcoin’s history, and as markets prepared to close on Friday, upward momentum showed no signs of reversing.

Modern Consensus takes a look at this week’s events, and where Bitcoin may be headed next week. We also publish a markets outlook every Monday, the latest edition of which can be found here.

Corporations fuel Bitcoin bull run

Bitcoin began the week on a firmly bullish note. Data from price trackers including CoinMarketCap showed a growing tendency to challenge the upper bound of the trading corridor between $11,000 and $12,000.

The mood among analysts and traders was positive—network fundamentals and a slew of other price indicators all pointed to support being in place to keep Bitcoin at at least $11,000.

Just a day later, bullish expectations became reality as BTC/USD retook $12,000 and maintained it, subsequently rising to $12,500 and then $13,000 as the week progressed. At its height, Bitcoin reached $13,200.

The clinch factor in the rapid gains, which some had nonetheless long expected, was news from PayPal. Having previously panned Bitcoin, the payments giant became part of Facebook’s Libra digital currency initiative before abandoning its partnership. This week, the company confirmed that it would support Bitcoin and three altcoins from 2021.

The news followed multiple announcements from publicly listed companies over Bitcoin, these beginning with MicroStrategy in July and since continuing, incorporating fellow payment network Square among others. All decided to purchase Bitcoin and reduce their exposure to fiat currency.

PayPal did no such thing, instead offering cryptocurrency custody and payment options reminiscent of a trusted third-party storage service. 

Reactions to the announcement were thus mixed, with some well-known Bitcoin figures warning that those who “purchased” BTC via PayPal would be denied a genuine Bitcoin experience. 

As a statement, however, consensus agreed that PayPal’s decision was a watershed moment.

“After PayPal’s news, every major bank is having a meeting about how to support bitcoin. It’s no longer optional…,” Virgin Galactic chairman Chamath Palihapitiya tweeted.

On Friday, rumors were once again circulating about the imminent announcement of a new corporate Bitcoin buy-in, with no concrete details available at press time.

So long macro?

The adoption angle provided an alternative narrative to that centered on macro factors such as the U.S. elections.

Just 10 days away, the event promises to shake up already uncertain markets, which in terms of the dollar depend on Washington’s ability to agree to a coronavirus stimulus deal as well as the election outcome.

Any weakness in the dollar should translate to gains for safe havens—gold and Bitcoin—while the opposite is also true, thanks to inverse correlation which Bitcoin has demonstrated against the U.S. dollar currency index (DXY).

Regardless of who wins, gold investors previously argued, the precious metal is also set for gains. For Raoul Pal, CEO of Real Vision, Bitcoin was the clear preferential asset going forward.

“Gold is breaking down versus bitcoin, as expected,” he wrote in a nod to MicroStrategy’s CEO, Michael Saylor.

“Everyone take note. The next thing I’m expecting is the correlations between BTC and the dollar and BTC vs equities to break down too… let’s see.”

Pal is not alone in his optimism over Bitcoin striking out on its own away from broader macro markets. As Modern Consensus reported, statistician Willy Woo forecast the phenomenon occurring in September.

Regarding the future, caution remained over the likelihood of further gains, the conservative outlook tapered by the situation on exchanges. Little sell resistance lies beyond $13,000, analysts note, with only Bitcoin’s all-time highs of $20,000 providing a major barrier.

“Lots of buy-stops at $13,000. There is nothing but air between $13K and $19K,” RT host Max Keiser summarized in a series of tweets this week.

“…Still waiting for a convincing, high-volume punch through $13K to trigger a load of buy-stops.”

The publication of this week’s commitments of traders (COT) report will highlight the overall tendencies among investors on both the institutional and retail side—specifically, at which prices the desire to buy or sell now lies.

Last week, institutions were overwhelmingly long BTC, while high-volume traders favored shorting, something which trader Tone Vays warned was a dangerous move below $11,500.

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Anthony Bevan is a journalist focusing on disruptive finance and cryptocurrency, along with the changing face of the market as Bitcoin gains mainstream adoption. Journalists covering cryptocurrency for Modern Consensus May hold positions in some of the currencies they write about.