Is Bitcoin Heading for $3,000? Potential Factors for a Market Recovery
After watching the price of Bitcoin going through its roughest month for seven whole years, many in the space appear to be bracing themselves for a more brutal “crypto winter” than they ever thought possible. One market analyst believes that we could be about to drop further to a new yearly low of $3,000.
That said, there has been very little in the way of negative news surrounding the number one digital asset. In fact, Bitcoin’s surrounding infrastructure has never looked better. Despite the lulls, such factors continue to inspire bullishness from familiar voices.
Bitcoin Price: When Will the Bleeding Stop?
Just like last year, the expectations of many have been defied in the closing months of 2018. Bitcoin has continued on its downwards trajectory to its current price of around $3,400. Many felt the end of the market bloodshed was here after the price spent so long in the $6,000 to $6,800 range. The following sharp decline over the last month has taken a lot of folks by surprise. However, some analysts believe we are far from the end of the current bear market.
#Bitcoin looking quite ugly here. If the uptrend support doesn’t hold I would aim to $3,250 and $3,000 as next targets.
Bear flag already breaking down.
More updates on $BTCUSD: https://t.co/WV7FKTZRa0 pic.twitter.com/Nq6sxGLc5a
— Crypto Rand (@crypto_rand) December 11, 2018
The view of Crypto Rand above is echoed by controversial YouTube technical analyst Tone Vays. In his latest episode, Tone argues that Bitcoin must first hit the 50 month moving average at around $3,000 before it will change direction and can begin to move up again:
“The most optimal scenario is actually a few more candles of consolidation into the $3,000 area, like a few more months of consolidation.”
The former Wall Street trader went on to state that a good base for further growth would be found if the price consolidated close to $3,100 in around March of 2019.
Trading #Bitcoin – We have dropped to $3,333 on $BTCUSD, we are once again flirting w/ Dangerous Territory to begin another Leg Down. Let’s have a quick look at the charts:https://t.co/wTNVmlWA00
— Tone Vays [@Bitcoin] (@ToneVays) December 11, 2018
The Uber-Bulls Hold On…
Despite technical analysts warning of further downside coming, some of the most vocal cryptocurrency bulls around are not worried by the current market conditions. The likes of Mike Novogratz might have lost money on the epic cryptocurrency decline of 2018 but he is still confident about the space’s future. He spoke to Bloomberg about the market and how he expects it to evolve in the coming years.
The billionaire investor and CEO of Galaxy Investment Partners first reasoned about the most recent price plunge:
“I did think Bitcoin was going to hold at $6,200. It stayed there for four months. It felt like the selling was finished. But then Bitcoin Cash decided to fork again. At the same time the SEC came out and sanctioned a few ICOs and said, ‘Oh, by the way, your investors can sue for damages.’ That scared the heck out of a lot of people.”
He then turned his attention to the leading digital asset’s future:
“I do believe Bitcoin is going to be digital gold… The fact that David Swensen put an investment into Bitcoin, with his reputation on the line, his endowment on the line, tells you something. Some of the smartest people in the investing world think it’s a store of value.”
Meanwhile, other cryptocurrency converts are still optimistic, despite the market downturn. Travis Kling, a portfolio manager at Steven A. Cohen’s Point72 Asset Management, recently spoke about how Bitcoin was anything but a short term play:
“So this is going to be a multi-year, multi-decade thing to play out, but, there is an inevitability to [Bitcoin] though. The ability to have a non-sovereign digital money.”
Perhaps the most important reason to remain a long-term bull on Bitcoin is the list of names creating improvements to the underlying infrastructure. Along with the likes of Coinbase, Circle, and Blockchain, huge traditional financial institutions are stepping into the market in a big way. Take Fidelity Investments, for example. The multi-trillion-dollar asset management firm plans to launch both a custody solution and trading desk for the planet’s richest investors in the coming months.
Likewise, the launch of Bakkt next year is also cause for celebration. This should make taking up positions in digital assets easier for retail and institutional investors alike. Behind Bakkt is the Intercontinental Exchange (ICE) – the owners of the New York Stock Exchange. Needless to say, the likes of Fidelity and the ICE would not risk their reputations on the space if they did not think there was a future for Bitcoin and other blockchain-based digital currencies.
Of course, such products and services do not guarantee demand for crypto. Encouragingly, however, they are likely inspired by requests from existing clients. If increased demand coincides with the launch of these platforms, that’s great. That said, the most important thing is that when demand finally does pick back up, acquiring, trading, and storing digital currency will be more accessible than it ever has been.
Related Reading: Bakkt Focusing on Bitcoin Due to Its Liquidity and Classification as a Commodity
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