bitcoin back to to previous highs

Bitcoin (BTC) clocked a 2.5-week high of $8,225 on Bitfinex earlier today and could soon scale the $8,500 mark, the technical charts indicate.

Prices jumped close to 14 percent on Thursday and moved above the $8,000 mark for the first time since March, according to Bitfinex. The sharp rally was reportedly fueled by the unwinding of the short trades (also known as short liquidation).

Moreover, BTC margin shorts (sell BTC trades) on Bitfinex stood well above December highs. As such, there was always a risk of short liquidation and bitcoin price rise. That said, the margin longs (buy BTC) registered a decline as well, thus putting a question mark on the sustainability of gains.

However, volume analysis suggests the rally is here to stay. The total trading volume across all exchanges jumped above $8 billion yesterday, according to CoinMarketCap. Also, the trading volume on Bitfinex hit a two-week high.

Further, the price chart analysis indicates a short-term bearish-to-bullish trend change, so, the cryptocurrency looks set to extend the rally. As of writing, bitcoin is changing hands at $8,100 on Bitfinex - up 18 percent on a 24-hour basis.