Bitcoin has exploded in recent days, jumping all the way to the $7,000 mark for the second time in a month. This is a solid improvement over where it stood just last week, and yet some are predicting that things are about to fizzle out all over again.
Bitcoin May Take Another Dip
This seems to be a running theme in the bitcoin arena. While BTC does well and many people seem to jump on board, there are others that refuse to see the light. Many still view bitcoin as a failing asset that has yet to make a serious mark on the financial industry. They were haters before, and they’ll continue to be that way until the final BTC unit is mined.
However, others predict nastiness for BTC not out of spite, but due to technical prowess, which they claim to possess. Some believe that technical indicators are suggesting the world’s number one crypto by market cap is about to drop all over again.
If this is true, it can be said the currency can’t seem to catch a break. Bitcoin has already taken a few huge stumbles in the past few months. In February, the asset was trading for well over $10,300, but by early March, it had fallen into the high $8,000 range. From there, the coronavirus pandemic began thrashing itself against the global economy, which ultimately (albeit briefly) brought bitcoin down into the high $3,000 range, thereby knocking close to $7,000 off its total price.
BTC has since gained nearly $4,000 more, but the asset still has plenty of room for improvement if it’s going to regain all it has lost since February.
One technical analysis says the convergence divergence indicator shows bitcoin encountering hardcore resistance at $7,500, which could potentially lead to the asset losing steam over the next few weeks. In addition, bitcoin and other forms of crypto appear to be moving in correlation with U.S. stocks, which are presently down, so the chart suggests digital currency could potentially move in the same direction.
Jerry Braakman – chief investment officer of First American Trust – explained in an interview:
When equity markets sell off, all people want to own is cash. When things are good, money will flow there and when things are bad, it’s going to have that downside.
Some Are Still Major Believers
Despite all the negative press, bitcoin still seems to be attracting legions of fans, including Mike McGlone of Bloomberg Intelligence. A longtime advocate of bitcoin and crypto, he believes bitcoin is on the verge of making a serious comeback and says:
In the third year since its peak, we expect bitcoin to continue doing what it has been – appreciating, but at a languid pace. Bitcoin’s 2020 average price… is the highest annual measure ever, indicating a market that is simply marking time.