Is the Rise of Bitcoin Short-Lived?

Over the past 24 hours, the Bitcoin price dropped 0.54% to $59,354.38. However, the cryptocurrency price increased by 11.2% over the past week, which indicates a solid recovery. Last month, BTC hit its historic high of $61,683.

What worries analysts is that the rise of Bitcoin may be temporary. 

Boris Schlossberg, a leading foreign exchange expert, believes that BTC price could be very close to an intermediate-term top. 

The current Bitcoin price rally has been led by high net worth investors and institutions. This is evidenced by Coinbase’s huge exits. Recently, Paypal Holdings Inc.’s report boosted Bitcoin prices. The company declared it would allow US customers to use cryptocurrencies to make payments. 

Paypal’s statements came after Visa Inc. made a statement. Visa said it would allow payments directly through cryptocurrency on the Ethereum blockchain.

According to Schlossberg, Bitcoin’s high degree of volatility would likely mean transactions on platforms like PayPal will be extremely small compared to regular currency. Still, he believes that BTC is a better store of value than gold.

Is the Price of Bitcoin in A Similar Stage of The 2017 Cycle?

Matt Maley, a chief marketing strategist at Miller Tabak, stated that it would be a significant warning if Bitcoin drops below $52,000. Besides, the fall would give the cryptocurrency its first lower low of the year. On the flip side, if the cryptocurrency broke above its recent highs of $61,000, it would be a prospect for future increases. 

As Schlossberg, Maley believes that BTC will see many more significant drops along its way in a very volatile session.

However, Ki-Young Ju, CEO of CryptoQuant, stated that taking a short BTC position does not seem to be a good idea. It is less likely to drop below $52,000 as institutions could have bought BTC at that level. 

Since then, the price of Bitcoin has risen by around 5%. Moreover, it has shown a relatively stable uptrend, possibly due to the US dollar showing signs of weakness again.

JP Morgan analysts are bullish on the price of Bitcoin. They have been studying the Bitcoin market and have found several trends that favor virtual currency. These are the stabilization of its market, reducing volatility in its price, one of the main problems for institutional investors’ adoption. Besides, BTC has demonstrated the strength as an alternative to gold as a store of value worldwide.

A group of JP Morgan analysts led by Nikolaos Panigirtzoglou stated that any displacement of gold as an alternative currency implies a tremendous advantage for BTC in the long term.