On Sunday, Bitcoin surged to an unprecedented level as investors turned to secure assets amid the U.S. government shutdown. This movement, known as “devaluation trading,” has driven both Bitcoin and gold prices to new heights.
Bitcoin climbed to $125,689 over the weekend, marking its highest point since mid-August according to recent data.
The U.S. government’s closure on October 1st prompted investors to seek alternative assets as a safeguard against economic instability. This situation also delayed crucial economic reports like nonfarm payrolls. Concurrently, gold soared past $3,900 per ounce today, setting a new record.
Alex Kuptsikevich from FxPro highlighted that diminished liquidity during the weekend intensified price movements:
“A similar trend was observed in July and August when significant increases followed fresh peaks at these levels.”
David Lawant of FalconX Research mentioned that open interest in Deribit and IBIT is nearing $80 billion—an approximate tenfold rise since early 2024:
“The dynamics of options markets are influencing spot price trends more than ever before.”
Rachael Lucas from BTC Markets pointed out that the next technical resistance is at $135,000 with a target of $150,000 due to ongoing momentum. However, she cautioned about potential high volatility risks if there are sudden market reversals due to increased leverage:
“Options markets exhibit strong upward momentum with over 60% open interest in call options indicating robust confidence but could lead to liquidation cycles if momentum weakens.””
*This content does not constitute investment advice.