Altcoin News: Why Bitcoin Is Growing Rapidly on Weekends?
July 1, 2019, by Marko Vidrih on ALTCOIN MAGAZINE
Bitcoin, which trades 24/7, tends to spike on weekends. In fact, surges in weekend activity since the beginning of May account for about 40% of Bitcoin’s price gains this year Bloomberg reports, suggesting the presence of a certain trend.
As an additional confirmation of his theory, the author draws attention to the fact that the price peak at $19,666 in December 2017 was reached on Saturday.
Bitcoin, unlike securities in most global markets, is trading around the clock.
“It’s absolutely unique,” said David Tawil, president of crypto hedge fund ProChain Capital.
Below are a few theories that can shed light on the question: Why do cryptocurrency asset rates tend to rise over the weekend?
- Ahead of events
News flows, like cryptocurrency trading, never stop. At the same time, large corporations may want to wait for Monday morning to make some important announcement. “Monday mergers,” for example, is a well-documented phenomenon when companies make important acquisitions on the first day of the week.
Similarly, cryptocurrency companies choose Monday for important announcements, and many traders may try to get ahead of the news at the weekend, Tavil said.
“It’s a little bit of anticipatory or front-running the news cycle by trading up on the weekend,” he said. “You’re somewhat flying blind in the sense that you don’t know if there will really be an announcement made on Monday morning but in a packed news cycle like crypto, where there’s developments really every day, I don’t think it’s wrong to bet that Monday morning would have a positive development.”
- Group thinking
Cryptocurrency investors can discuss various news stories with friends and colleagues over the weekend, thus pushing them to buy a certain token.
“The market is, by and large, retail individuals and I think that weekends are a time when those people have more free time to read the week’s news, to chat with friends, to pitch friends on exciting things they heard about during the week,” said Hunter Horsley, chief executive officer of Bitwise Asset Management.
In 2017, the rate of Bitcoin was associated, including with Thanksgiving Day, when investors, who had already joined the crypto-fever, could tell their relatives how to buy Bitcoin.
A similar effect is given by blockchain conferences, Horsley believes. Bitcoin grew up during the New York blockchain week in May, where thousands of people gathered to share information about the latest events.
- Volume reduction
Although prices are rising at the weekend, a smaller number of traders may take part in the trades, draws attention to the head of the international activities of the Decred crypto project Jonathan Zeppettini.
“The fact that these markets are operating when the banks are closed leads to price movements being exacerbated,” said Zeppettini by email. “It also takes a lot less to move the needle when everyone’s sleeping or it’s the weekend.”
Bloomberg Intelligence analyst Mike McGlone shares this opinion:
“It is more Asia and those more sophisticated traders picking time and paths of least resistance to profit,” said McGlone. “I fully expect the leveraged money professional-types are utilizing all tools to spark moves and profit from.”
- Fomo
Probably, there are those who are watching the possibilities of Bitcoin growth during the working week, and then joining during the weekend amid heightened fear of missing out(FOMO). So, by last Saturday, Bitcoin grew by 22% over the previous five days, after which it added another 10% at the weekend.
“It is mainly driven by opportunistic investors,” said Naeem Aslam, chief market analyst at Think Markets UK in London, adding “Those are “people who are following the heard and have huge FOMO.”
Author: Marko Vidrih
