Yesterday Bitcoin hit brand new annual highs. At one point it nearly touched $14,000 US dollars. However, gains were wiped out with bitcoin at the time of writing showing itself down 6.2%. Over one week Bitcoin remains up 28% and over one month remains up nearly 35%.
The quick drop has been blamed on whales taking profits and the crash of Coinbases website yesterday evening.
According to Coinbase’s status page, the exchange reported major outages across its website, mobile apps and API, though its internal systems appeared to be functional during that period. When reached, a spokesperson told CoinDesk: “We’re back up.” At 5:17 ET, the exchange’s status page noted: “A fix has been implemented and we are monitoring the results.”
Data from CoinLib reveals that BTC’s latest rally is not driven by new investor money. Instead, existing crypto traders are simply moving money back into bitcoin from the sidelines. most of the bitcoin trading volume came from existing traders moving money back into play. Fiat flows from the dollar and yen represent a much smaller portion of the volume, suggesting “new money” is not yet driving the market. This data, however, may be subject to manipulation of “reported exchange volumes”.
Google searches for “buy bitcoin” are more than 90% lower than they were when the 2017 astronomic price increase occurred suggesting that the current bull run is not driven by retail mania.
If this analysis is correct there are probably still some vast sums of money waiting to move into the market as Wall Street sets to establish a number of Bitcoin Investment Vehicles.
If history repeats, there should be plenty of strong pullbacks on the way to the next peak ATH.
There were at least nine 30%+ pullbacks from the last cycle of accumulation and uptrend. Some traders are viewing the pullback as an opportunity to buy the dip and that “instead of scaring people away, these price crashes are doing the exact opposite by attracting more buyers and strengthening support.