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Analysts comment on Bitcoin’s latest rally. (Photographic illustration by Edward Smith / Getty Images)
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Bitcoin prices have seen a healthy rally, rebounding nearly 20% after falling to nearly $ 30,000 yesterday.
The world’s most valuable digital currency by market value hit $ 36,957.52 earlier today, according to data from CoinDesk.
At this point, it had climbed about 19% from the price of $ 31,035.49 it hit yesterday, its lowest since May 19, additional figures from CoinDesk reveal.
[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.]
In explaining the latest digital currency price movements, analysts cited several developments, ranging from the latest signs of growing adoption to cryptocurrency markets that have become oversold recently.
Bitcoin’s correction is likely over, said Mike McGlone, commodities strategist for Bloomberg Intelligence, adding that the market is on the cheap.
I expect the $ 30,000 support to stay on the path of $ 100,000 resistance, he said, offering technical analysis.
Charlie Silver, CEO of Permission.io, offered a similar contribution, stating that:
Support seems clearly set at 30k for BTC but it can be tested multiple times.
If that holds up, I think we’ll see new highs by the end of the year.
Strong fundamentals
In addition to providing technical analysis, McGlone described the fundamentals of bitcoin as strong, highlighting factors such as the fixed bitcoin cap of 21 million units at a time when central banks have potentially unlimited capacity to invest. print money.
Silver also commented on the spread of money printing around the world, noting that the United States has put billions of dollars into circulation in the past 18 months or so.
While he described the world’s largest economy as leading the way, he said most countries around the world have participated equally in this activity.
The subject of money printing has become a hot topic in recent years, as central banks around the world have issued new units of fiat currency to help support economies struggling with the effects of the global pandemic.
While this development has helped fuel the concerns of many market watchers, it has been seen as a boon for cryptocurrencies with capped supply.
The Savior
In addition to highlighting the impact this aggressive monetary policy could have on cryptocurrencies, analysts also spoke about the latest news from El Salvador, where the country’s lawmakers recently passed a legal tender bill. to bitcoin.
With El Salvador’s recent announcement, this is certainly a monumental moment, and it will continue to validate bitcoin and other cryptocurrencies and further stabilize prices after a few volatile weeks, Silver said.
Nick Mancini, research analyst at Trade The Chain, a provider of crypto sentiment data, also commented on this latest sign of adoption, as well as the anxiety surrounding the potential for sharp increases in the price level.
We agree that the inflation concerns and the news about Bitcoin adoption in El Salvador have been a big positive punch for Bitcoin, he said.
The outlook for traders on Bitcoin began to improve around 1 a.m. ET, when the Salvadoran news broke, Mancini said, citing exclusive data from Trade The Chain.
The price and sentiment of Bitcoin is currently increasing in parallel, and we expect this trend to continue.
Bullish outlook
Several analysts have offered a positive outlook for bitcoin, citing variables ranging from market factors to expectations of increasing adoption.
We can see below that Bitcoin has been oversold and has formed a bullish RSI divergence – a very bullish indicator – which occurs when the price and the RSI indicator diverge in a specific direction, Mancini said, highlighting a A technical indicator called the relative strength index, which measures the extent to which a particular asset is overbought or oversold.
We believe Bitcoin can top up around $ 35,000, but as long as sentiment remains bullish, interest in derivatives increases, and order book interest continues to build up to around $ 35,000, BTC should continue to rise. increase, he said.
Money offered a longer-term perspective, focused on the growing use of the world’s most important digital currency.
Bitcoin really serves as a store of value, he pointed out.
I think the next big wave was going to start seeing sovereign countries reporting how much bitcoin they have in their treasury, Silver said.
The US dollar and US Treasuries have always been the sovereign store of value along with gold.
I think bitcoin will start to replace US Treasuries and dollars when countries like Ecuador, Colombia, Philippines start reporting what they have in their treasury.
Disclosure: I own bitcoin, bitcoin cash, litecoin, ether, and EOS.
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