Bitcoin (BTC/USD) continued climbing higher this weekend, establishing a new two-week high of $254 on BTC-e 6 hours ago. It has since eased back to $242 but the uptrend is not yet broken.
The latest leg of BTC’s recovery began 24 hours ago, then trading flat near $228. It then climbed by as much as 11.5% on healthy volume exceeding 1000 BTC/hour.
BTC has now retraced the majority of its 2015 losses, as it has done following other recent downturns. If the downtrend will indeed resume, it is likely to begin from the mid-upper $200s.
Litecoin’s gains have by far outpaced those of bitcoin, and even most other altcoins. It had been trading in the $1.40s and began to rise in sync with bitcoin. It actually momentarily spiked to $2.87 on BTC-e, gaining nearly 100%, before falling back into the $1.50s. Thereafter it resumed its rise, again in sync with BTC, to as high as $2.40, a gain of 60%.
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LTC’s first spike likely arose from an oversized order and lack of sufficient liquidity. The disproportionate gains from both big moves are more likely to have been amplified by short covering, possibly through margin calls on traders caught in the wrong direction, than a huge buying spree by a bullish investor.
Sentiment around the coin had not been positive of late as it seeks to find its niche among many other cryptocurrencies. Today’s gains are somewhat reminiscent of its late 2013 days, albeit at a fraction of the price. It has gained more than 100% since nearly falling below $1, but such rallies are commonplace when losing more than 95% of one’s value.
Since peaking above $2.40 six hours ago, it has since given back more than 15% to fall back below $2. Should the declines extend, the theory of short covering would be reinforced.
Bitcoin prices on BTC-e are roughly $4 (1.6%) below those on its peers, an average offset.