Strong positive price movements throughout the past week have helped push the price of bitcoin to a two-week high. Unfortunately, exchange volumes continued to trend lower, raising concerns of increased volatility. With the bitcoin price having broken out beyond resistance levels, traders will be watching for fresh support to be established over the next week.
Bitcoin Price Recap
What appeared to be strong resistance at $235 in both the exchange and OTC markets broke Sunday night with a nearly 2% jump in price, capping a strong week for the bitcoin market. This price spike was led primarily by trading activity out of Asia.
Volumes coninuted to trend lower this week and September is currently on pace to have the lowest trading volume of any month this quarter. If these thin trading volumes continue, they could lead to greater volatility across the bitcoin market.
Bitcoin by the Numbers
Bitcoin Trading Week Ahead
It is too soon to claim that the new highs achieved last week are sustainable. Breakouts have been short-lived recently and building meaningful momentum has been difficult. For example, sellers took the opportunity to trade out of positions when prices hit $224 less than a week ago.
This sudden move up seems all too familiar and could result in a price dive back below $235 this week. However, should prices hold firm through Tuesday, short-term support could be established at $235 with resistance at $242 (a key early-September resistance level).
Best Bits from Last Week
- Medium: The 21 Computer
- NYT: The Benefits of Allowing Bitcoin to Flourish
- WSJ: Bitcoin License Hits a Milestone
- EFinancial News: Blockchain: A Magical Leap for Finance – Maybe
Bobby Cho is the Director of Trading at itBit and heads our Global OTC Agency Trading Desk. Previously, Bobby was Vice President of Trading at SecondMarket where he helped create the first broker-dealer based institutional bitcoin trading desk. He has extensive experience in both bitcoin and securities trading with clientele ranging from Fortune 500 companies, hedge funds, asset managers and other financial institutions.
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*All data and references are current as of 9:00AM EST on 9/28/2015.