Bitcoin has enjoyed a huge upturn in fortunes in 2019 and its value soared by almost 30% in the first week of April. That followed a strong performance in March and it suggests that the year-long bear run is finally over. Bitcoin generated enormous media attention when the price skyrocketed to almost $20,000 by the end of 2017 and investors giddily jumped aboard the bandwagon. But its value was continuously eroded throughout 2018 and had decreased to just $3,700 by the end of the year. Now it has back up past the $5,000 mark and some investors are bullish about its chances of achieving further gains. Trader Peter Brandt predicted that the price could now surge to $50,000 by 2021. “When bitcoin starts moving, it moves,” he said. “It doesn’t hold up for everybody to catch a stagecoach. We saw sequential 10 up and down moves in the bear market, and we’ve almost identically formed that same sort of pattern. After the 2015 low in bitcoin, we saw the market then developed into a parabolic advance. Based on those analog studies, I think crypto now will go back into a parabolic bull market.”
The number of retailers accepting bitcoin continues to grow, so it is becoming a lot more widespread. Microsoft, Shopify, Dish, and Overstock are among the retailers that take the popular cryptocurrency, meaning you can buy everything from Xbox games to pizzas without having to use fiat currencies like dollars. All the best online sportsbooks now allow bettors to make wagers using bitcoin, as it is so much faster, easier and cheaper than betting in fiat currencies. Meanwhile, Google searches for bitcoin are back up to the levels previously seen in November 2018, when its price was last north of $5,000.
That has all sparked greater mainstream media coverage of bitcoin and many buyers have been inspired to start investing in the crypto market. Rival coins like Bitcoin Cash and Litecoin are also surging, but bitcoin remains very much the market leader. It has just enjoyed its best week of 2019 and bulls are hoping for a sustainable move above $5,300 for the recovery to gain traction.
In other news, the U.S. Securities and Exchange Commission has reassured investors in a startup using crypto-tokens to raise capital that it will not take action against the firm. TurnKey Jets, which aims to offer all-inclusive private jet services replete with a plane, pilot and crew, was sent a No-Action Letter. It was the first the SEC had issued such a letter regarding the cryptocurrency world.
Researchers at Fundstrat wrote a note to clients explaining projections for bitcoin going forwards. “Based on bitcoin’s trading history, a move above the 200-day moving average for bitcoin is meaningful statistically,” they said. “When bitcoin is above its 200-day moving average its win-ratio is 80% compared to a mere 36% when it is below its 200-day.” They added that the six months forward returns average 193%, so moving above the 200-day moving average is a really big deal.
One question that will plague investors is whether bitcoin’s price really has bottomed out. It has lost 84% of its value since its peak, and many argue that it will not go below $2,000. There is no guarantee that bitcoin has bottomed out, but right now everything indicates that it has switched to bullish and has the ability to continue climbing in the weeks and months ahead. Yet there is also a risk that it slips into an overbought mode and it is due to a downside correction before growth resumes, which could spark concern among short-term investors.