Market Analysis: Bitcoin (BTC) Skyrockets to $4,800, Most Major Cryptocurrencies Up Over 10 Percent, Total Crypto Market Cap Surges $19 Billion

April 2, 2019 / by Zachary Mashiach

Just after midnight Bitcoin (BTC) shattered the $4,200 level, which is a long term resistance level that has been in place since December. Bitcoin (BTC) rallied to as high as $5,080, an astonishing 21 percent rally in just two hours.

According to Reuters, a single whale bought 20,000 Bitcoins (BTC) worth $80-100 million across three exchanges at the same time, and this was enough to trigger a massive short squeeze. There was likely a large concentration of short orders at and above the $4,200 level, and when Bitcoin’s (BTC) price began to spike due to this large buy order, these shorts were closed out in succession. Essentially, when a short order is closed, Bitcoin (BTC) must be bought to cover the short, forcing the price even higher, causing more short orders to be closed, and this becomes a rapid positive feedback loop.

Since the rally, the price of Bitcoin (BTC) has stabilized near $4,800, with a trading range between $4,650 and $4,840 throughout the day. It appears the new resistance level to watch is near $5,000 with support at $4,600-$4,700.

Even though the Bitcoin (BTC) rally wrapped up in the early morning hours, it triggered a broad crypto rally that has been continuing all day. This is shown by the total crypto market cap surging from $147 billion to $164 billion when Bitcoin (BTC) rallied, and when the Bitcoin (BTC) rally wrapped up around 3 a.m. Eastern time, the total crypto market cap stabilized at $159 billion. Since then, the total crypto market cap has been increasing and is now at $166 billion. This is a gain of $19 billion in less than 24 hours, which is by far the biggest crypto rally of 2019.

Most major cryptocurrencies are up over 10 percent, and the big winner of the day is Bitcoin Cash (BCH), which is up 28.3 percent. Ethereum (ETH) is up 12.4 percent, Ripple (XRP) is up 10.5 percent, Litecoin (LTC) is up 19.5 percent, EOS is up 15.1 percent, Binance Coin (BNB) is up 11.1 percent, Stellar (XLM) is up 9.2 percent, Cardano (ADA) is up 14.2 percent, Tron (TRX) is up 8 percent, Bitcoin SV (BSV) is up 12.4 percent, Monero (XMR) is up 12.1 percent, Dash (DASH) is up 9.8 percent, IOTA (MIOTA) is up 8.6 percent, and Dogecoin (DOGE) is up 12.6 percent.

Following today’s rally, the total crypto market cap is now 66 percent above the bear market low of $100 billion reached in mid-December. It is starting to appear that the lows reached in mid-December were indeed the bottom, and it is possible that the consistent gains seen since February represent the beginning of the crypto market’s emergence from the bear market.

One positive factor for Bitcoin (BTC) and the crypto market is that the CME Bitcoin futures expiration happened less than a week ago, and since Bitcoin (BTC) has rallied so much in the interim, it is likely that CME Bitcoin futures traders have gone long for the month of April. The combined upward pressure from CME Bitcoin futures traders and the strong buying pressure that was already present in the market could lead to a crypto rally throughout the month of April.

It is important not to assume that this is the beginning of the major crypto bull run the market has been waiting for, even if Bitcoin (BTC) rises all month. In the past there have been month-long rallies when CME Bitcoin futures traders went long, only to be followed by a crash when CME Bitcoin futures traders went short the next month.