Fast money trader Brian Kelly recently talked about Bitcoin’s recent price spike on the show. The surge that occurred at the end of the weekend caused the price of Bitcoin to rise by more than 10% to more than $39,000, and it rose by more than $4,000 in one day.
Brian Kelly agreed with the host of the show, Melissa Lee, saying that short covering caused prices to soar. Kelly explained that as the weekend approached, the massive short covering around assets caused prices to soar. Presumably, there are many factors that cause the price to soar.
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Rumors of Amazon integrating Bitcoin on its platform have been the leading theory behind the price spike. But Kelly explained that rumors are only part of the reason for the major changes in digital assets. Outline other factors that contributed to the rebound.
The catalyst for price spikes
Brian Kelly (Brian Kelly) talked about the speculation that Amazon news is the main catalyst for Bitcoin’s price surge. Kelly explained that Amazon’s news was released on the market about a week before the momentum picked up.
According to Kelly, a large number of shorts plus Amazon and News from Tether As the weekend draws to a close, this has led to a “big short squeeze”, when market liquidity is usually lower than usual.
BTC price breaks $40,000 for the first time in over a month | Source: BTCUSD on TradingView.com
As prices soared, the short squeeze liquidated more than $1 trillion in shorts within 24 hours.Bitcoin contributed more than 70% of this amount, see $800 million short Liquidation in the same period.
After a brief squeeze, Bitcoin’s trading volume and volatility levels rebounded, and Bitcoin has been at an annual low for about a year. Since then, the momentum of digital assets has been strong, and the market seems determined to ride this wave for as long as possible.
Still bullish on Bitcoin
Kelly answered questions about asset prices rebounding before reaching $40,000. It is not unexpected to say that the rebound. Kelly is still optimistic about Bitcoin. “The real game here is whether it will be used as an institutional asset,” Kelly said. “And I didn’t see anything that changed my mind.”
Kelly went on to add that the decision of the Federal Bank and the Federal Reserve to continue printing money may be a decisive factor. Kelly said, “Based on my score, I don’t see how they can’t continue printing.”
The speed at which the Federal Reserve prints fiat currency is still a concern for investors. If the number of printed banknotes is not controlled, this may lead to inflation. For this reason, Bitcoin has become an attractive asset for investors worried about inflation. Given the limited supply of assets, individuals or governments simply cannot print or produce more coins. Therefore, fight against inflation.
Bitcoin continues to be bullish. At the time of writing, the asset price has now exceeded $40,000 and continues to show an upward trend.
Featured image from NBC News, chart from TradingView.com