Many hedge funds moved amid the rise in the price of bitcoin to the level of $39,000, which is just below the large resistance of $41,100, acting in addition and the upper border of a wide sideways channel.
As the saying goes, “during the gold rush, sell shovels”. This is exactly what hedge funds are doing, seeking to get rich by investing in cryptocurrencies with only one condition – they invest money not in the cryptocurrency itself, but in platforms and exchanges created for buying, selling, and storing virtual currencies.
Against this background, many regulators are increasingly wondering what protection companies working with crypto assets should offer investors in order to attract the attention of such large investors. Apparently, in the near future, this area will be subject to strict regulation, so the tightening of the rules that apply to such companies seems inevitable. On the other hand, digital currency regulation will help it grow and make it something more than just an electronic code on a computer.
Against this background, investors invest money in such companies with the expectation that in the future one of them will become the next Amazon.com Inc. or Alphabet Inc.
Many people associate the current growth of bitcoin with the appearance of ads from Amazon.com Inc., about vacancies related to hiring employees to work in the crypto industry. This caused rumors that the company may make bitcoin an additional means of payment for its services by the end of the year, and may also issue its own digital token.
Similar attempts have already been made by Facebook, and we remember how it ended – the sharp indignation of the American regulator and Zuckerberg’s rejection of this idea.
The job posting announced by CoinDesk says Amazon is looking for a head of “digital currency and blockchain strategy.” Analysts are also wondering if the move could ultimately lead Amazon to accept bitcoin as a payment method. It is worth noting that today’s surge in the market has brought cryptocurrencies back to life, the volatility of which has decreased tenfold after the May collapse. Enthusiasm has been further shattered by harsh regulations in China and criticism of miners for the negative impact on the environment.
This jump in bitcoin may be the last before its hike to the level of $20,000, which apparently everyone has already forgotten, although a couple of weeks ago only everyone was talking about it. But we will talk about the technical picture below.
It is noteworthy that according to the latest data, more than $940 million of cryptocurrency shorts were liquidated on Monday – the maximum since May 19, which does not yet indicate an increase in interest in buying bitcoin. At the very least, this can secure BTC from the breakdown of $29,000 for a while. But do not get into euphoria, most likely that the closing of short positions for such an amount was associated with margin calls due to high leverage.
Returning to the topic of investing and hedge funds, it is worth recalling that most recently, the FTX crypto derivatives exchange raised $900 million from more than 60 investors, including Paul Tudor Jones, Alan Howard, and Izzy Englander. These guys are also investing in Block.one, a blockchain software company. The $55 billion Paul Marshall Foundation Marshall Wace LLP is a sponsor of Circle, a digital payments firm that is part of the consortium behind the USDC stablecoin. In general, while the market is storming, large investors see it as a serious prospect, which gives a chance for the development of the industry in the near future. Don’t miss this moment too.
As for the technical picture of bitcoin, a sharp breakout of the $35,900 level and growth to the $39,000 area leaves quite a lot of hope that the bulls will once again test resistance at $41,100 in the near future. A breakout and an exit beyond this range will open a direct road to the highs of $46,700 and $52,000. If the pressure on bitcoin returns in the near future, the bulls will need to try not to let BTC go below the $36,700 support since a lot depends on it. If the rate goes below this level, most likely the pressure on the world’s first cryptocurrency will return, and we will see the support update for $33,300 and then a retest of $29,200, which will be the last blow to the hopes of buyers for the rapid growth of the cryptocurrency. So far, everything is turning in favor of the bulls. Let’s see what happens to volatility next.
*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.
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