On June 10, Wednesday, Bitcoin experienced a short bull run greater than $10,000. There are shorts liquidations worth $14 million on BitMEX. This caused the cryptocurrency to drop back below $10,000. Nonetheless, BTC/USD maintained its goal towards $10,000. It is when the Federal Reserve’s commitment to keeping interest rates near zero until 2020 drove the U.S. dollar to its three-month lows.
Bitcoin had its medium-term resistance level around $10,000 but it came crashing down later by circa $300. There was an immediate correction that surfaced after BitMEX reported short liquidation nearly $14 million. The move showed that many traders did not expect bitcoin to fall out of the $10,000 level.
A recent tweet from Cryptowatch revealed an intense rise and fall as $15 million gets liquidated at BitMEX.
The cryptocurrency dropped to $9,690 fifteen minutes after the short liquidation. In the early Thursday session, it recuperated back above $9,900.
What was the reason for Bitcoin Price Rally?
Bitcoin surpassed $10,000 because of the Federal Reserve’s promise to maintain interest rates near zero until 2020. In a press brief on Wednesday, Fed Chairman Jerome Powell stated that they were not thinking about raising rates. In fact, they were not even thinking about thinking on raising it.
Spot traders saw the central bank’s expansionary policy as their sign-in buying bitcoin. The view depicted inspirations from the S&P 500, which rose shortly, but later turned choppier. The United States benchmark and Bitcoin have recently developed a temperamental positive correlation.
Bitcoin’s rally also took place as the U.S. dollar drops to its three-month lows versus foreign currencies. Investors let go of their cash-positions for risky alternatives which might have ended up profiting the top cryptocurrency. Traders view a sinking dollar as a sign of fortifying bitcoin.
Mike Belshe, the CEO of BitGo hoped that the prediction of a crash in the U.S. dollar is wrong. He further noted that if you think it might be right, you should allocate 2% of your net worth into Bitcoin now.
Salient market analyst Mohit Sorout emphasized that Bitcoin’s correction below $9,700 did not mature because there is still a big buying interest for the cryptocurrency. He added that traders are not crashing Bitcoin below its June’s opening rate near $9,445. The trader further recalled the same pullback behavior near the May’s monthly open at $8,622.
On Mohit Sorout’s tweet, he showed evidence of buyers’ interest near June’s monthly open. He said on the same twitter post that: “This level got front run on recent dumps.”