Bitcoin Prices Trade Nearly $ 50,000 After Hitting New Multi-Month High

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Bitcoin prices have stuck at nearly $ 50,000 after their latest upward move. (Photo by … [+] INA FASSBENDER / AFP) (Photo by INA FASSBENDER / AFP via Getty Images)

AFP via Getty Images

Bitcoin prices have repeatedly hit multi-month highs today, hitting their highest level since May, then fluctuating within a reasonably narrow range.

The world’s largest digital currency climbed to $ 50,352.00 around 3 a.m. EDT, according to figures from CoinDesk.

Later, around 10 a.m. EDT, it hit $ 50,374.97, according to additional data from CoinDesk.

At this point, the cryptocurrency was trading at its highest value since May 15.

Following these latest price movements, several analysts have provided explanations on the causes of the rally, as well as what bitcoin prices could do next.

[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]

Lots of potentially bullish factors

It’s hard to pinpoint the cause of the rally, but unlike stocks, which are determined by fundamentals, cryptos are purely market driven, said Anthony Denier, CEO of Webull Financial trading platform.

There is a lot of news, market momentum and investor sentiment to trigger a rally, he noted.

There is likely a lot of optimism among investors that El Salvador plans to start using Bitcoin as its national currency next week. But other factors appear to be behind the broader rally in the cryptocurrency market.

He pointed to the strength of other leading digital currencies, in particular Cardanos ada and ether, as potentially fueling the broader gains of the crypto markets.

Other analysts cited additional reasons as potentially contributing to the latest bitcoin rise, with Charlie Silver, CEO and Chairman of Permission.io, highlighting the impact of central bank money printing.

The rally is driven by the recognition that the US Fed and central banks around the world have no intention of slowing down their asset purchase programs, he said.

Institutions recognize that they need security in non-dollar denominated assets and Bitcoin is perfectly designed for that purpose.

String data

Some experts have pointed to the information extracted from the blockchain, which has helped paint a bullish picture of bitcoin.

Data on the channel shows whales and long-term investors of all sizes have racked up between $ 46,000 and $ 50,000, said Sean Rooney, head of research at Valkyrie Investments.

The continued build-up over the past 6 weeks has led the BTC balance on exchanges to flirt with multi-year lows, he noted.

Scott Melker, a crypto investor and analyst who hosts The Wolf Of All Streets podcast, also weighed in.

Chain measurements indicate coins are being moved en masse from exchanges to cold rooms, and few major players are selling, he said.

In fact, large wallets have been aggressively accumulating Bitcoin for 30K. The drop to 30K was exacerbated by strong leverage in the system, so the price likely fell a lot more than it would have in a vacuum, Melker added.

The price is now catching up to its natural level.

Fragile Feeling

Currently, it may appear that the digital currency is enjoying a perfect storm of bullish developments.

However, Denier noted that the situation could change quickly.

Bitcoin’s return to $ 50,000 means investors are bullish on cryptocurrencies again, but its pursuit will depend on a strong move above $ 50,000. With news and new information being the main drivers of the market, any negative news could bring it down significantly, he said.

Technical analysis

In addition to shedding light on the many variables that may have been behind recent bitcoin price movements, some market watchers have looked at key resistance and support levels for digital currencies.

Bitcoin is showing strength as the US session approaches, after 12 days of consolidation, said Mark Warner, chief trading officer at BCB Group.

We expect a decisive breakout of $ 50,000, if not today, then in the very short term, with $ 50,000 becoming a support level.

David Keller, chief market strategist at StockCharts.com, also offered a perspective.

Bitcoin is used to finding support and resistance at large round numbers, he said.

At this point, Bitcoin is now testing the $ 50,000 level and we have seen a number of failed attempts to eclipse that resistance level. The good news for Bitcoin bulls is that if we break above $ 50,000 and continue higher, there will be very little resistance from a technical standpoint until the upper $ 50, Keller said.

He also spoke about the levels digital currency could face if it falls back.

On the downside, we have 200-day moving average price support as well as recent swing lows, all in the $ 46,100- $ 46,600 range, Keller said.

The chart remains constructive above these levels. If Bitcoin fell lower, investors could expect further support to previous lows of around $ 44,000.

Disclosure: I own bitcoin, bitcoin cash, litecoin, ether, and EOS.

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