Why Did Bitcoin Spike and When Is the Best Time to Buy?
Why did Bitcoin spike to a six-month record high of roughly $12,500 in the middle of August? The reasons are complex and numerous, but those reasons include the current instability of traditional currencies and the fact that US banks can now hold onto their customers’ digital wallets. Although Bitcoin is known for volatile spikes and plunges, numerous factors indicate that this spike is part of an overall upward trajectory for BTC prices. Now is the ideal time to buy Bitcoin and get in on the BTC action.
Why Did Bitcoin Spike on August 17th?
For the past three months, Bitcoin prices have fluctuated between $9,000 and $10,000. Then on August 17th, Bitcoin prices went above $12,000, breaking through critical resistance points. Since then, BTC prices have pulled back slightly, but remain on trend with several support points.
But why did Bitcoin spike? Our experts believe that there are multiple factors that led to the recent Bitcoin spike.
Global Economic Uncertainty
The current pandemic has greatly affected both the national and global economy. From slowed international pathways for imports and exports, to families struggling to pay their monthly bills, the economic effects on traditional financial markets and services have been devastating.
These extremely unstable economic conditions have led an increasing number of people to seek financial stability from alternative sources. Just as gold prices have been on the rise, so too have BTC prices.
New Policy for US Banks
Most banks in the US have refused for years to get involved in cryptocurrency transactions. That all might be about to change, however, now that the federal government has announced that banks can create and store digital wallets for their customers.
Why is this significant? When influential institutions give support to cryptocurrencies, then it becomes easier for people to recognize Bitcoin as a legitimate currency.
Although Bitcoin has always been accessible to everyone because of its decentralized nature, the fact that banks can now offer cryptocurrency services helps to increase access options. BTC prices have likely increased because cryptocurrency users are anticipating an even greater surge as banks begin to formulate their alternative currency policies.
Fibonacci Levels
When trying to figure out why did Bitcoin spike in late July, it’s important to consider Bitcoin’s entire pricing history. If you look at the Bitcoin price chart from 2009 to present day, you can see that it looks like a series of peaks and valleys. Each high “peak” tends to be followed by a lower “valley,” and then another “peak.”
Some people look at the BTC price chart and say that it reflects a highly volatile currency. However, these peaks and valleys are perfectly normal and expected. They reflect what are called Fibonnaci levels, or expected lows and highs in any financial market even when part of an overall upward trend.
Whether Bitcoin or a more traditional currency, many investors anticipate these “resistance levels” ahead of time, and plan their investments accordingly. Given that Bitcoin has held steady above $10,500 for several weeks, it seems to have broken through its most recent “valley” or resistance level, and shows no signs of going backwards.
USD Instability
Over the last few weeks, the US dollar has greatly weakened in value. Predictions that the Federal Reserve will maintain interest rates near zero, seemingly unlimited printings of money, decreased use of central bank liquidity swaps, turbulent second-quarter GDP numbers -- all this and more has led to the USD meaning much less among national and international markets.
What does that have to do with Bitcoin? As the USD price dropped over the last few weeks, Bitcoin’s actually surged -- and this trend is predicted to continue.
Will Bitcoin Prices Continue to Climb?
As you can see, the answer to “why did Bitcoin spike” is more complex than it might first appear. Unsustainable financial measures, global economic uncertainty, new cryptocurrency policies for US banks, and natural market resistance levels have all contributed to Bitcoin’s most recent price hike.
But will Bitcoin’s price continue to trend upward? While we of course can’t predict the future, there are many signs pointing to “yes.” In the past, when Bitcoin has broken $10,000, it has not been able to sustain that price. But BTC prices have remained at over $10k for nearly a month.
So far this year, while many traditional financial markets have seesawed, Bitcoin prices have surged more than 60% total. And compared to its low point back in March, BTC prices have climbed an extraordinary 180%.
There are many other metrics that indicate Bitcoin’s prices will continue to rise. Traditional financial markets show highly dubious, if any, signs of recovery or even stability. Meanwhile, there are more Bitcoin digital wallets now than there have been in the past three years, meaning more and more people are using the cryptocurrency for transactions and investments. Traffic on cryptocurrency exchanges has also increased 13% over the last month and 26% since December.
When Is the Best Time to Buy Bitcoin?
Wanting to buy Bitcoin, but not sure when is the best time to do so? Now might be the ideal moment.
With Bitcoin prices on the upswing and most traditional financial markets struggling, there’s never been a better time to buy or trade Bitcoins. Since there is a finite amount of Bitcoins, you don’t have to worry about financial institutions or governments printing money out of thin air. And as neither the pandemic or its economic impacts show any sign of slowing down soon, you need to invest your money in a dependable source.
Looking for a more exact time to buy Bitcoins? Recent data shows that Sunday evenings might be the optimal time to buy Bitcoins, when trading volumes tend to be low before picking up again during the workweek.
Our Bitcoins ATMS Are Available Sunday Evenings and Any Other Time
When it comes to buying Bitcoins for the first time, there’s no easier way to do so than with a Pelicoin Bitcoin ATM. We operate a large network of Bitcoin ATMs across the Gulf South in 24/7 stores. Our ATMs walk you through step-by-step the whole process of buying Bitcoins, including options to scan QR codes, enter alphanumeric wallet addresses or even to create paper wallets. Even if you’re a Bitcoin pro, you’re sure to appreciate the convenience and safety of our Bitcoin ATMs. Contact us today at support@pelicoin.com or check out our FAQs to learn more about why Pelicoin ATMs are the best around.