The price of Bitcoin rose sharply early on Monday, soaring 4% in just minutes.
The leading cryptocurrency started rising around 12.15 am Hong Kong time, increasing from $8,787.11 to an intra-day high of $9,123.34 less than 10 minutes later, according to CoinDesk figures published in a Forbes report.
After enjoying this rally, Bitcoin retained most of its gains, trading at $9,056.65 at 5.50 am Hong Kong time, according to Coinmarketcap.com.
Joe DiPasquale, CEO of cryptocurrency hedge fund manager BitBull Capital, attributed the rapid ascent to technical factors.
“The current move is a technical recovery,” he told Forbes.
“We mentioned previously that we expect the 50-day moving average to continue acting as support, and that has allowed the price to recover temporarily.”
DiPasquale previously noted that Bitcoin’s 50-day moving average was roughly $8,600.
“However, the 200-day moving average is still a strong resistance at $9,200 and Bitcoin needs to surpass that level with good volumes to put $10,000 on the radar – failing to do so would keep the possibility of a return to $8,000 alive.”
Cryptocurrency investor Marius Rupsys also spoke to technical factors, noting that Bitcoin has been “trading close to 50 and 200-day moving averages.”
“Traders are quite cautious around these areas. So it might be just some traders positioning themselves before Monday.”
Rupsys and Dipasquale both emphasized Bitcoin’s relatively low trading volume when explaining its recent gains.
The “weekend has less volume, therefore price action can have more volatility,” noted Rupsys.
Dipasquale emphasized that because “volumes are low, price surges like this one [are] temporary and unreliable.”