If you will look at the current price of Bitcoin, it seems that Mike Novogratz is correct after all that it has already bottomed. In the past 17 to 18 months, Bitcoin has been quite stable in its price. In addition to this, there is also the positive sentiment regarding the future of cryptocurrencies. In fact, it does make sense to buy shares now that Bitcoin is at around $6,500 level.
But if you are going to Fundstrat technical strategist Rob Sluymer, he believes that you should be waiting to buy Bitcoin. According to Sluymer, “Investors should remain patient and wait for evidence of an improvement in ‘trend’ before increasing exposure”.
In 2017, Bitcoin was able to reach near $20K level in mid-December. However, as regulatory changes happened, Bitcoin has slumped and even traded around $5,700 at one point. One of the reasons why many are optimistic regarding Bitcoin today is the fact that there could be a possibility of having a Bitcoin ETF.
A Bitcoin ETF application from VanEck and Solid X is believed to have the strongest chance of being approved by the US Securities and Agency. In the past months, the agency has denied Winklevoss-led Bitcoin ETF along with other applications citing the possibility of price manipulation.
Reversal Should Be Validated
In order to ensure that there really is a reversal, it is imperative that Bitcoin moves above its September price. Sluymer said that “A move above the September real and relative highs remains the key resistance/reversal level that will need to be exceeded to signal the early stages of a trend reversal”. This only means that he isn’t sure whether or not Bitcoin has already bottomed or not.
There are others saying that the quiet nature of today’s crypto market is a sign that there is maturity within the market. On the other hand, there are also those saying that it is a good thing since it is a sign that price manipulation has already subsided.
Nigel Green who is the founder of the deVere Group, he said that current stability within the crypto market is actually a “signal that the cryptocurrency market is maturing”. Mike McGlone who is a Bloomberg Intelligence commodity strategist thinks that this trend is likely to continue. He mentioned that “This is a maturing market, so volatility should continue to decline. When you have a new market it will be volatile until it establishes itself. There are more participants, more derivatives, more ways of trading, hedging and arbitraging”.
With a more stable crypto market, it is also possible that there will be more companies and businesses willing to try cryptocurrencies. One of the reasons why there is poor adoption in the crypto market today is because of its volatility.
Slowly, institutional investors are now participating in the crypto market. For instance, you have ICE teaming up with Microsoft, and Starbucks. In fact, Bakkt is also expected to launch in the coming month. And because of this, many are also expecting a short-term bullish trend. But should you wait a bit before you buy more Bitcoin?
