Cryptocurrencies traded higher on Friday after a volatile week. Bitcoin was holding above $33,000 support at press time and is roughly flat for the week. Technical charts suggest buyers will remain active above $30,000, although upside momentum is starting to slow heading into the weekend.
“The possibility of price action dropping into the mid-$20,000 range is alive, but traders looking for a retest of previous all-time highs will likely be disappointed,” Sean Rooney, head of research at crypto asset manager Valkyrie Investments, wrote in an email to CoinDesk.
- S&P 500: 4369.55, +1.13%
- Gold: $1808.4, +0.31%
- 10-year Treasury yield closed at 1.358%, compared with 1.297% on Thursday
“The May price drop was dramatic, whereas the on-chain reaccumulation of the bitcoin sold in that downturn into longer-term holders has occurred throughout eight weeks of sideways price action,” Rooney wrote. “This sets up well for an end-of-summer rally heading into the fourth quarter.”
Bitcoin shorts pile up
More than 5,000 bitcoin shorts were added on the Bitfinex exchange on Thursday. “When shorts close their positions, they do so by going long to offset their short exposure,” tweeted Delphi Digital.
The recent buildup in shorts is still below peak levels in June, which suggests pessimism could continue as bitcoin remains in an intermediate-term downtrend that began in April.