Bitcoin bulls are steadily taking control of the market after more than a week of acute declines. The bears pressed the pause button allowing the buyers to breath. Bitcoin dropped over 35% in the last 7 days. Besides, the most valuable digital asset plunged 50% in one month.
Bitcoin price tested $4,200 (2018 lows) before making a correction touching $4,600 to the upside. The bulls have been keen to establish several short-term support areas at $4,500, $4,400 and the important zone at $4,200. BTC/USD currently exchanges at $4,536 and is up 2.2% on the day. The bullish reversal is not unique to Bitcoin, other assets like Ethereum and XRP are also in the green with gains clocking 2.5% and 2.2% respectively.
The short-term analysis shows that Bitcoin is bullish and could correct higher and reclaim the position above $5,000. The 15’ 100 SMA is currently crossing over the longer term 200 SMA. This means that the buyers are gaining ground against the bears while buying activities increase. The stochastic has avoided the oversold for more than 24 hours indicating that the current trend is likely to continue in the near-term.
Tom lee Reaffirms $15,000 Prediction
The current drop is one among many that have caused jitters in the market since the year started. Bitcoin has not been able to recover above the long-term bear trendline. In fact, it has lost over 75% of its value since the all-time high. However, in some instance, Bitcoin has proved its ability to recover significantly as shown the daily chart for BTC/USD.
One of the most respected Bitcoin bull expert, Tom Lee of Fundstrat is giving a subtle blind eye to the recent devastating plunge. Although he brought down his end-year prediction to $15,000 from $25,000, the analyst has unwavering confidence that Bitcoin will come out of the bear trend before the end of 2018.
Tom Lee said reiterated this while in an interview on Bloomberg. He went ahead to talk about a couple of players in the crypto market. The first player is the one that buys crypto to use and has a wallet. While the other is the speculative kind. Lee says that the two parties must find a way to “sort of interact with each other.” He reckoned that this is the only way to ensure that these price crashes do not burn them.
While keeping his crypto rebound prediction into perspective, Lee said that he is aware of the market trend that has “certainly” been in a “negative development.” This trend indicates a “downside of the momentum.”
Lee emphasized the importance of having institutional investors in the market noting that the recent drop to $4,200 has not exactly hurt them. According to Lee, institutional investors are what the market needs for its “next wave of the adoption.”
There are a couple of factors that are expected to be the force behind institutional investors entrance. One being the introduction of a digital platform Bakkt by one of the leading players in the stock markets, New York Stock Exchange (NYSE) in collaboration with the International Exchange (ICE). The platform is expected to be released sometime in January 2019. The second factor is regulations, which are known to increase institutional investors’ confidence.
“Once we have that [regulatory clarity], I think, institutions will feel more comfortable in making bets.”