Bitcoin Market Continues to Hit New Highs
Every time I check the price of Bitcoin, it has gone up even more. The last week has been full of consistent updates that highlight the breaking of new resistance points. Now Bitcoin has hit a high of $8,335 (on BitStamp) and is hovering around the $7,900 level.
Bitcoin has just hit a 10-month high and many are calling this the beginning of the next bull market. We have just experienced the highest monthly gain since November 2017, which as you may recall, was right before the crypto crash. It was also around the time where traders were speculating on the CBOE potentially listing BTC futures.
Where to Next?
Some investors to believe this is going to be a pump followed by a fade, since FOMO is very strong right now. The unofficial heuristic is when all your friends start asking about cryptocurrency, the market is about to crash again.
Altcoins have not been keeping up to Bitcoin, and a large part of this is due to the recent Binance hack. While the security review process is underway, deposits and withdrawals have been disabled. This adds a lot of friction to users looking to invest in altcoins, and when Binance does finally open up, we can expect a rapid rebalancing to occur.
The most likely thing to happen is we will see a slight pullback over the next few weeks, a shift to the altcoin space, and then a more solid bull market emerging. The moving averages have crossed each other in the right way, and there are a bunch of other fundamental reasons why the cryptocurrency sector is due for a resurgence.
Opportune Moment or Short-Term Trap?
A lot of this has to do with the market dynamics. Users who have been eying Bitcoin for a while see this as a buying sign, even if it could be too late. Bitcoin’s dominance has reached highs around 60% just as the market capitalization of all cryptos totalled $240 billion.
The question is: will this buying pressure continue, or are these newcomers going to run out of stream? These investors will naturally flood their money into exchanges like Coinmama, Kraken, CEX.io, or Gemini, but how many of them are there? These fairweather investors may have gotten burned in the crypto crash of a few years ago and are only now giving it another try.
The stock market has been down over the last few days, which might help to stoke the fire in the bellies of contrarians who think Bitcoin is a proper hedge against the current system.
In other news related to the crypto markets, Coinbase’s unveiling of XRP on their platform has made Ripple a top gainer. The timing for them couldn’t be more perfect, as they get a higher pump due to the frothy buying occuring due to Bitcoin’s pump. There really are a bunch of different forces at play here, and the question is about how they will play out in the short-term.
If this bull rush has accomplished anything, it is proving that Bitcoin is not dead, it was just sleeping. Those who believed they’d never hear about Bitcoin again and it was a point moot are going to have to cope with it coming back into the mainstream (as it has started to do).