Bitcoin is experiencing a significant upswing as ‘Uptober’ kick-starts with a surge past $116,000 early Wednesday morning, effectively reversing most of the losses incurred over the preceding two weeks. This impressive rally has propelled the total market capitalization of cryptocurrencies to an impressive $4.09 trillion.
As of the latest figures, Bitcoin is trading at $116,441, reflecting a daily increase of 3.1%, according to CoinGecko data. The bullish sentiment in the market triggered a cascade of liquidations, resulting in approximately $60 million in short positions being wiped out during the London trading session, as noted by Coinalyze data. Following this rally, Bitcoin’s year-to-date gains have risen notably from 15% last Friday to 25% by October 1.
Bitcoin’s dominance in the market has also seen a resurgence, climbing from 57% to 59% following its successful breach of the $114,000 mark. An analysis by Glassnode highlighted that this not only indicates a healthier market structure but also suggests that Bitcoin-led rallies tend to be more sustainable compared to those driven by alternative cryptocurrencies.
Experts assert that various factors are fueling Bitcoin’s recent price increase. Shawn Young, chief analyst at MEXC, attributed this rise to “structural demand, sustained exchange-traded fund flows, and strong institutional positioning.” The confidence in the market is further underscored by recent options data, which shows a 55% decline in Bitcoin’s 25 delta skew. This drop indicates a reduced need for downside protection, reflecting increasing investor confidence.
Traders are optimistic about a potentially strong fourth quarter for Bitcoin, which historically sees median gains exceeding 50%, as evidenced by Coinglass data. Derek Lim, head of research at Caladan, pointed out that current macroeconomic conditions, including the ongoing U.S. government shutdown and a dovish stance from the Federal Reserve, create a favorable landscape for Bitcoin’s performance.
The slight decline in the S&P 500 during recent electronic trading sessions, in contrast with Bitcoin’s rise, suggests a capital rotation into cryptocurrencies. This sentiment has been echoed on the prediction market Myriad, where users now see a 63% chance of Bitcoin’s dominance climbing to 63%, as opposed to a drop to 53%. Moreover, optimism has grown regarding Bitcoin’s price, with predictions indicating more than a 65% likelihood of it surpassing $125,000 rather than falling to $105,000—a notable increase from just 53% the previous day.
Overall, Bitcoin’s recent momentum and market indicators reflect a burgeoning optimism within the cryptocurrency space, suggesting a potentially fruitful quarter ahead.