Over the past week or so, cryptocurrency has boomed. For some, this came as a shock surge but for others, it was a well overdue growth that was market needed/needs. The valuation of the crypto market has increased from $252 billion to $288 billion by more than $36 billion as the price of Bitcoin climbed towards the $9,400 on some of the biggest exchanges out there such as Coinbase and Bitstamp.
According to traders, Bitcoin has been “extremely bullish” over the past few weeks and based on technical indicators, it is set to see resistance at around nine and a half grand in the short term.
Can the Momentum keep going?
The general consensus on Bitcoin and crypto was pretty grim in the near to medium term of December last year. The performance for most coins was dull and the Bitcoin Cash hard fork seemed to pile onto the market's worries. Some investors feared the worst in that the bear market would last all throughout 2019 as well as the majority of 2018. In fact, a lot of startups were preparing for the worst or at best, months of downward price action. But now, it seems that the sky is the limit.
After the flagship cryptocurrency dropped to the $3,100 range, its price quickly started to recover as the uncertainty in the international economy slightly subsided and the equities market of the US started to rebound.
Despite what many people will believe, some strategists have said that Bitcoin was affected by the panic sell-off of assets in late-2019 that was fueled by the trade war between the United States and China.
As the global economy began to demonstrate some signs of recovery, Bitcoin started to recover to the levels of 2018.
Speaking on the matter, the CEO and founder of ARK Invest, Cathie Wood has said:
“Yes, and crypto hedge funds facing redemptions in the fourth quarter were forced to sell their most liquid cryptoasset, BTC, causing the drop from $6000 to $3000. The bounce back to $6000 in the first quarter was not surprising, the follow-through to $9000 impressive.”
Across 2018 and the first half of this year, the crypto sector has experienced a very noticeable increase in the influx of finance coming in from institutional investors who are showing a keen interest in the crypto space.
The global markets analyst, Alex Krüger has said:
“JP Morgan analyst acknowledges what has been relatively obvious for about two months already: it is mostly institutions behind the bitcoin bull-run, rather than retail investors, as it was during the 2017 mania.”
It still isn’t any clearer as to how severely the market was impacted by the introduction of big financial institutions, capital brought in by institutional investors usually remain in the market for extended periods of time rather than capital from retail investors.
With this, Bitcoin might not have seen a spike as an inflow of capital over recent weeks but the capital from institutional investors that have repeatedly come flooding into the market over the past 12-18 months which is said to have kept the momentum going.
The crypto trader and technical analyst, Josh Rager:
“Bitcoin has been extremely bullish and foresee a test of the major resistance between $9500 to $9600 the 0.382 fib (is a typical ‘take profit’ area is at $9532) But last time everyone expected a major pullback in the $6ks it busted right through to $7k+.”
Speaking in a recent interview with CBS Sunday morning, the notorious Winklevoss twins stated that they believed Bitcoins would have an impact on gold when it purchased one percent of the dominant crypto asset’s supply.
Known for their work with Facebook and the original Bitcoin billionaires, the Winklevoss twins are household names when it comes to the crypto community.
The Winklevoss twins have said:
“Our thesis at the time was bitcoin’s going to disrupt gold. And gold has a market cap of $7 trillion today. So if bitcoin’s going to be worth $7 trillion or more, this seems like a cheap asset. It was a complete Wild West.”
At the start of the week, Bitcoin was priced around the $9,280 price range but as the market grows and keeps on gaining momentum, investors are more than likely to get more confidence in the world of crypto. This will hopefully push the price of BTC above the $10k mark and beyond.