Bitcoin crossed $20,000 for the first time on December 16 as bulls delivered an intense blow to long-extant sell walls.
Data from price trackers and exchange orderbooks showed BTC/USD rapidly gaining during trading on Tuesday, hitting highs of $20,600.
Bitcoin puts in a casual new all-time high
That level marked not only daily gains of more than 6%, but also a new all-time high for Bitcoin on multiple major exchanges.
At press time, the largest cryptocurrency was experimenting with never-before-seen levels amid intense volatility, having broken $20,500. Just hours before, it had traded at closer to $19,000 support.
Analysis of exchange orderbook data further showed that a large wall of resistance previously in place at $19,500 had significantly decreased, with just the area between $19,900 and $20,000 left to claim. The change marked a significant shift in sentiment — trader appetite was now zoning in on record-high price levels as an entry, not exit point.
“If this trend continues the second half of December could see $24k #Bitcoin with a retracement to $21k and then $35k in Q1,” Bill Barhydt, CEO of crypto wallet service Abra, summarized.
“Get ready for a hell of a ride!”
The positive mood received yet another boost late on Monday thanks to the latest news of an institutional player entering the market. Ruffer Investment, the UK-based investment giant, confirmed it had allocated 2.5% of one of its funds to BTC — worth $15 million.
“One recent addition, via one of the specialist managers appointed within the Ruffer Multi-Strategies Fund, has been bitcoin. This is primarily a defensive move, one made in November after reducing the company’s exposure to gold,” a letter to investors read.
“The exposure to bitcoin is currently equivalent to around 2.5% of the portfolio. We see this as a small but potent insurance policy against the continuing devaluation of the world’s major currencies. Bitcoin diversifies the company’s (much larger) investments in gold and inflation-linked bonds, and acts as a hedge to some of the monetary and market risks that we see.”
Ruffer joins an increasingly competitive corporate buying marathon, with industry leader Grayscale adding a total of 115,236 BTC to its assets under management in Q4 alone. The stash is equivalent to $2.2 billion.
“I’ll repeat… Bitcoin liquidity crisis incoming,” Danny Scott, CEO of UK exchange Coin Corner, added in accompanying comments.
Overall Bitcoin performance thus adhered ever closer to long-term quant predictions from one of its best-known models based on stock-to-flow. PlanB, the model’s creator, issued an updated version of the stock-to-flow chart which highlighted how BTC/USD was tracking its performance during the bull cycles in both 2013 and 2017.
“BTC price (red dots) moves nicely towards model line (white line), just like 2017 and 2013. And … do I see a little orange?”