Bitcoin’s price (BTC/USD) jumped sharply higher this weekend, rising by as much as 10% to $254 on BTC-e.
Historically, such price swings are not uncommon for bitcoin. But the sudden rise broke what had been yet another lengthy stretch of some of the quietest trade in recent memory.
Bitcoin spent the majority of last week dabbling in the low $230s, barely budging more than 1% in either direction. Historically, lengthy stretches of abnormally quiet behavior are frequently compensated for with major moves in either direction.
Bitcoin’s flat activity helped it gravitate back toward its 50-day moving average (MA), which it had been straddling for nearly two weeks. The jump sent it well clear of this mark, which has now settled to below $230. Its distance from this mark is now similar to that of two weeks ago when bitcoin jumped above $260 and to that in late January when bitcoin briefly jumped past $300. Bitcoin has not traded this far above the MA since last November.
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The continued stability relative to short-term history strengthens the notion of a possible bottoming process, but a lot would have to fall into place for this to happen.
Unlike during the previous mini-rally, BTC has held onto the majority of its gains–mirroring its flat profile prior to the rally, only $15 higher. It is currently trading at $246.
Litecoin, however, has not followed bitcoin’s lead as it typically has in previous rallies. It did make a large move relative to its trailing profile, but the magnitude was but a fraction of bitcoin’s–3% to$1.84, most of which has already been given back. Volume is below average with just under $1 million traded during the past 24 hours. The resultant LTC/BTC rate has thus declined to a 6-week low of 0.0072.
The spread between BTC-e and its peers continues to be wider than normal. It is currently around $6 (2.4%).