Bitcoin prices broke the $40,000 price mark today, seemingly breaking out of the stagnation they have fallen into in the last few weeks.
According to CoinDesk data, the world’s most popular digital currency has surpassed this level late today.
Additional CoinDesk data reveal that it was now up over 20% from the six-month low it reached late January.
The cryptocurrency has managed to surpass the $40,000 psychological barrier and trade within a very tight range since then.
The intraday high for the digital asset was $40,901.18 at 3:00 EST.
[Ed Note: Investing cryptocoins and tokens is highly risky as the market is not regulated. It is possible to lose all of your investment.
These are the latest bitcoin gains.
Many articles, including those published in MarketWatch or CoinDesk mentioned the U.S. Jobs Report, which revealed that employers added 467,000 positions to the country’s workforce in January.
This figure was significantly higher than the consensus figure 125,000 job, which was provided by Bloomberg analysts.
A number of market experts contributed to this article, emphasizing how important it is for both the latest jobs report as well as other important factors.
Many spoke out about how closely digital currency prices have been following equities up to recently.
“Bitcoins and Ethereum were closely linked with SPX and Nasdaq for most of the week until this morning when both currencies began to outperform,” said Josh Olszewicz (head of research at Valkyrie Investments).
“This decoupling was further exaggerated after the release Non-Farm Payroll data and unemployment data, which were far better than expected.
Tim Enneking (Managing Director of Digital Capital Management) also spoke out on the matter.
“Strangely enough, the rally was a function decorrelation (finally!). The day before, the crypto markets were converted to SPX. He stated that a more natural price movement was possible once the shackles had been removed.
Enneking stated that the news in crypto has been generally positive, with nothing particularly bad emerging (although WormHole is a contributing factor). He also said that ‘only’ the US’s pending crypto rules could be a negative.
“In short, there was no reason to price down here in this place in the first instance other than the risk off mentality that leaked from fiat markets, resulting in the very high correlation. He stated that this appears to be over, and crypto can now take its natural course.
Analysts also pointed out the short interest that existed prior to the price rise, which could have easily increased bitcoin’s gains.
Dylan LeClair is the head of market research at Bitcoin Magazine. He stated that one of the main reasons for the strength in the move was the large amount short interest that had been opened within the $30,000 range. This forced bears to close their positions.
He stated that ‘our analysis shows that previous bitcoin bottoms were characterised by periods of derivative-market bearishness, especially when perpetual futures financing was negative for long periods of time’.
“With negative funding mounting up, there were approximately $53,000,000 in total short liquidity over the past eight hours helping bitcoin send over $40,000.
Other than the ones listed above, there are other factors that may have contributed to today’s Bitcoin rally.
Olszewicz highlighted these issues, saying that “other factors potentially leading to Bitcoin’s rally today include the persistent negative funding rate for derivatives which often occurs when shorts pay longs.”
He stated that the put/call ratio of all options maturities was at its highest since late 2018. This could indicate a crowded trading environment and shorts haven’t been liquidated or pressured since November’s highs.
The analyst said that the fear and greed sentiment index had been below 30 since January 1st. This is usually a sign of oversold markets.
The Fear And Greed Index was 20 at the time this article was written, pointing to Extreme Fear’