Bitcoin Breaches $57,000, Will the Uptrend Continue?
After recording a new all-time peak and hitting a market cap of over $1 trillion, the view about Bitcoin has turned extremely bullish. The cryptocurrency has defied the forecasting models of several analysts and could more further in unchartered zone.
At the time of writing this article, Bitcoin was trading at $56,559, up 1% in the last 24 hours. In the weekly and monthly charts, Bitcoin is trading with a gain of 21.1% and 60%, respectively. The market cap currently stands at $1.06 trillion.
Academic institution Santiment has detailed the bullish and bearish case for Bitcoin after the numero uno crypto recorded its fresh all-time peak of $57,851, reflecting a gain of 219% in the past three months. With respect to bullish view, Santiment highlights that Bitcoin liquidity is on a decline in all major cryptocurrency exchanges.
Hence, selling pressue on Bitcoin is on a decline thereby paving way for the uptrend to continue. On the downside, Santiment points out that the financing rate in the futures market, with regards to BitMEX, indicates that traders with short positions are getting higher incentives to speculate for a drop in the price of Bitcoin.
Amidst the bears and bulls, there were tweets from CryptoQuant CEO Ki-Young Ju. Even now conscious of the premium on Coinbase platform that went negative after the $56,000 surge, Young Ju claimed purchasing power came from “stablecoin whales and small investors.” As a consequence, Young Ju claims that due to the scarcity of fresh dollar capital flows mostly on spot market, the value has shifted towards “unhealthy” territory.
He also stated: “It isn’t really a short alert, but if you’re a seller in derivatives, be cautious.”
Data scientist Rafael Schultze-Kraft disclosed that some of that digital currency is being traded in prevailing price levels on the flow of money into BTC than before it reached $30,000. I find latest traded prices (measure of inflows of capital) astonishing.
“20% of supply moved above $30k
9% of supply moved above $40k
Already 2.6% of supply moved above $50k
Current major on-chain support levels: $52k and $48k.”
Put simply, as BTC keeps rising, optimistic buyers have become less willing to book profits. The band between $48,000 and $52,000 is then marked as a support zone by SchultzKraft.
Nevertheless, the crypto market could be entering the “euphoria/greed zone,” as pointed out by the Unrealized Gain indicator that has stood unaltered since BTC hit $41,000.
Euphoria/greed zone next?
— Rafael Schultze-Kraft (@n3ocortex) February 19, 2021
In the years ahead, the growth in market capitalization suggests that fund managers will gain more interest in Bitcoin. oBeing regarded as gold of the modern age, the cryptocurrency will then consolidaten its own . Mike McGlone, Bloomberg Intelligence Senior Analyst, has addressed Bitcoin from an “institutional point of view” and estimated that Bitcoin would be much more expensive than the yellow metal by 2024 and in the years to come.
McGlone claims it was “easy” for Bitcoin to grow 4-5x its original valuation due to the halving characteristic, rising demand, and macroeconomic factors of the decline in new BTC production after 2020.
There’s no excuse to argue why there is no possibility to maintain a comparable speed and hit 2, 3 or 5x (prevailing price hike), which will be $100,000 (…). For an increase in prices, there’s an ideal condition.
Bitcoin has only hit 9.4 percent of the yellow metal’s market capitalization, as IntoTheBlock strategist Lucas Outumuro observed, suggesting Bitcoin’s price will have to climb over tenfold to surpass gold. If that occurs, a Bitcoin will be worth $500,000, Outumuro stated “:
Not anticipating this to come quickly, but more as a systemic change over decades. Generally, promising days for Bitcoin and underlying blockchain technology.
Bitcoin just reached $1 trillion in market cap.
Progress towards overcoming gold (~$11 trillion):
— Lucas Outumuro (@LucasOutumuro) February 19, 2021