Bitcoin Range Continues for a Second Day
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Bitcoin is continuing to trade range-bound. After yesterday’s $10 dollars, the range today shrunk to a mere $7 dollars. The daily low stands at $340.03 and the high at $347.50. We are currently quoted just of the highs at $341.83 on BTC-E. As usual prices are somewhat higher on OKCoin at $345 and BitStamp at $350. The chart below shows yesterday’s range marked in yellow, today’s range is colored purple.
As we’ve seen recently, congested periods like these often end in breakouts. The main points to watch for are $360 on the upside and $332 on the downside. A move below $332 may lead to more losses toward the $319 swing low. This is followed by the $300 round figure. A breakout above $360 may accelerate the gains to $388. Above here, possible resistance levels include $400 and the important swing high at $454.
In an email exchange with CryptoCoinsNews, BTC payment processor BitPay provided some numbers on merchants holding bitcoins. According to the company, out of a total of 44,000 merchants, 22,000 convert all the coins received to cash. A smaller 18,000 hold on to some coins and only 4,400 merchants keep all bitcoins received as payment. BitPay didn’t provide a breakdown on the percentage of total volume converted to fiat.
This makes it hard to judge exactly how much of the BTC received is instantly converted and thus has a downward pressure on the price. But I would suspect that most of the merchants holding on to bitcoins are the smaller shops. The only figure we have for a major retailer is that Overstock keeps 10% of all bitcoins received. Since Overstock is run by Patrick Byrne, a big supporter of cryptocurrencies, the percentage for other major firms is probably much smaller. The larger companies like Dell or DISH likely convert all of their BTC to USD.
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