Today, Bitcoin climbed to a new record of $111,888 on the Bitstamp exchange and was up more than 8% in the last 24 hours.
As a result of the rally, Bitcoin is now valued at almost $2.2 trillion, more than Amazon.
Although prices have increased, analysts report an unusual pattern that sets it apart. Conor Grogan has noted that trading volumes were their lowest on record during the latest cryptocurrency high.
Bitcoin’s daily chart also suggests the market is nearly overbought, as the RSI currently stands at 77.23. Over the years, these readings have pointed to a temporary slowdown ahead or to a phase where corrections occur.
Adding Bollinger Bands on the same graph, we see the price touching the upper band, indicating powerful buying but potentially soon to end. These factors worry experts about protecting the environment in the next few years.
ETF data also demonstrates that institutional investors are highly interested. Wednesday saw a total of $614 million go into bitcoin exchange-traded funds, suggesting more investors are turning to them as demand continues to rise.
A large amount of ETF activity has helped Bitcoin climb over recent months. Sustained inflows indicate that big investors have faith in the Bitcoin market despite the low volatility in spot trading.
Consequently, this difference in actions by retail and institutional traders is being paid close attention. The rise of institutional investors could explain why prices are moving more than in the past.
Expert Reactions Raise Concerns Over Unusual Rally
Analyst Conor Grogan noted that few markets respond with low volume when reaching a major price success.
Spot volumes usually increased before past rallies of this kind. With few retail investors involved this time, it’s possible that any slowdown in large investor buying could weaken the rally further.
Essential indicators are still being carefully observed. Should daily trading remain low while RSI stays above 70 for some time after falling, we could see a correction soon.
Although ETFs are still bringing in funds, market players are now questioning the form of the current rally.
Conclusion
Bitcoin’s rise to $111,888 created a new record, but many experts say that the way it happened is not usual. Since indicators might suggest the market is overstretched, traders are encouraged to be ready for risks.
