Bitcoin Investors Wait for Signs of Potential Rally Action

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Satoshi Nakamoto Remains a Bitcoin Mystery After All These Years
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Final Week of August Turns Bullish for Bitcoin | Cryptocurrency Growth
Final Week of August Turns Bullish for Bitcoin
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From Lamborghini auctions to CNBC tweets and interest from institutional investors: these are some of the signs that Bitcoin traders are keeping an eye on to determine when the world’s most valuable digital currency will once again enter rally mode.

The Bitcoin rally that started around the middle of July lasted less than two weeks and failed to reach the $10,000 level many traders were hoping for. Things turned bearish since July 25 and a string of less than positive news has dampened the possibility of a rebound; if anything, Bitcoin trading has turned into a highly technical affair based on interpreting charts and keeping an eye on momentum, volume and pricing indicators. Despite the absence of significant bullish action, traders have been paying attention to certain developments that suggest another rally may be on the horizon.

News of Cryptocurrency Trends Spreads in New Ways

News stories about Bitcoin and other major cryptocurrencies being adopted to settle purchase transaction are always welcome by traders and investors. The biggest news in August came from a Forbes article explaining how Bonham, the renowned international auction house based in Europe, is using cryptocurrency to quickly settle wealthy buyers of exotic cars. Bonham is working with a company that provides a digital currency wallet service that provides exchange stability for the purpose of closing a sale in just a few hours. Normally, a Bonham transaction takes weeks to clear when foreign buyers have to wire millions of dollars; this is not the case with cryptocurrencies.

Bitcoin investors are also evaluating the reaction of the Twitter community whenever news reports are posted. Traders are finding that social media mentions have a strong correlation with Bitcoin momentum and trading volume; as can be expected, interviews with renowned analysts tend to create a spike in buying. Gauging the level of engagement combined with certain technical indicators can suggest whether Bitcoin is heading in the direction of a rally.

In recent weeks, a lot of interest has been placed on trading volume at the most bearish Bitcoin levels. Technical traders and market analysts have noticed that hedge funds and other institutional investors tend to take positions when they notice an ideal “buy zone,” which in Bitcoin’s case happened a couple of weeks ago when it dipped below $6,000. The “buy zone” phenomenon is related to the Bitcoin futures being traded on the Chicago exchanges, but it is difficult to tell if most institutional investors are sticking to futures or if they are taking positions directly on the major digital currency exchanges.
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