Regardless of a 12% drop, Bitcoin is prone to hit the very best month-to-month closing worth ever
Despite the sharp decline over the past week, Bitcoin appears to be on track to hit the highest monthly close of all time.
The number one cryptocurrency by market value fell over $ 3,000 to $ 16,242 on November 26, eliminating excess leverage from the derivatives market. The decline has been short-lived and prices have rallied more than 50% from the retreat in the past few days.
As of press time, Bitcoin is trading at around $ 18,600 on major exchanges. This is significantly higher than the peak price observed on December 31, 2017 at the end of the month of around USD 13,880.
The upcoming record close could, according to some observers, be a harbinger of a stronger bull run. "Every time Bitcoin closed above the previous monthly all-time high, it was followed by an upward trend of 700% to 1000%," tweeted crypto analyst Josh Rager earlier this month. Market analyst Lark Davis shared a similar view on Monday.
Bitcoin monthly chart
Bitcoin rose nearly 27% in April 2017, tumbling its previous monthly closing record of around $ 1,150, which it hit in November 2013. This was followed by a steep rally to nearly $ 20,000 by December 2017. Strong rallies followed after Bitcoin set a record high for monthly closing prices in January and October 2013.
History to repeat itself?
Analysts are bullish about the longevity of the bull market. Some point to $ 36,000 as the level to watch once the immediate psychological resistance is scaled to $ 20,000.
Factors blamed for the recent eight-week rally from $ 10,000 to $ 19,400, such as: B. Increased institutional involvement, securing demand due to the dollar sell-off, a potential spike in inflation, and seeking returns alongside record levels of negative interest-bearing debt worldwide are expected to continue to generate profits in the cryptocurrency.
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"People are saying that institutions will get into the crypto industry for years, but it seems that this year it will already be," noted crypto exchange EQUOS in its daily bitcoin analysis email. "Of course there is much more to be done, and the level of funding and the unchangeable shortage of Bitcoin will be very noticeable."
According to analysts at JP Morgan, further profits will largely depend on continued institutional participation. If the inflows into the grayscale Bitcoin trust slow down, the cryptocurrency could suffer if momentum traders continue to pull back, analysts wrote in a Nov. 27 release. temporary investment. Grayscale is part of the Digital Currency Group, the parent company of CoinDesk.
Bitcoin has surpassed gold by leaps and bounds this year. While the top cryptocurrency is up 158% since the start of the year, gold is only up 17%.
The two assets have diverged this month, with Bitcoin gaining over 30% and gold falling 5.5%. According to the data source TradingView, this is the highest monthly decline since November 2016.
Meanwhile, global stocks are on track to seal a record month with expectations that potential coronavirus vaccines would lead to a rapid recovery in the global economy over the next year. Bitcoin needs to make a profit on a possible sell-off of stocks in order to cement its appeal as digital gold.
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