Bitcoin Sees More Pain Before Price Recovery
Bitcoin Sees More Pain Before Price Recovery
Bitcoin’s painful start of the year isn’t over, according to research firm Fundstrat Global Advisors LLC.
Bitcoin is down more than 60 percent from its high of almost $20,000 in December and will only show signs of bottoming closer to $5,873, according to a Fundstrat report Thursday. Negative headlines on tightening regulation globally and decisions from Facebook Inc. and Alphabet Inc.’s Google to ban ads on digital coin sales are weighing on the cryptocurrency market.
“When sentiment is this weak, the market is increasingly ’fire, ready, aim’ -- meaning, any headline today is likely to trigger selling," Fundstrat analysts including Tom Lee and Robert Sluymer wrote.
Bitcoin had almost doubled from its low just below $6,000 in February but failed to cross $12,000 and is now sinking past key level after key level. Over the past eight days, Bitcoin has broken below support at $9,325, and Wednesday broke the $8,370 level. Its next support is at $7,535 followed by the February lows at $5,873, according to the report.
There are some bullish signs emerging. Bitcoin currently trades at the break-even cost of mining, currently at $8,038, based on a model by Fundstrat’s data scientists Sam Doctor and Ken Xuan. The digital currency bottomed in 2015 when it was at the same multiple relative to mining costs as it is today, and peaked in 2013 at 21 times its mining costs.
Additionally, March is seasonally the worst month for Bitcoin, rising only once in the last seven years. April is one of the strongest, rising five times in that period.
Bitcoin Sees More Pain Before Price Recovery
Reviewed by mir khaleq ali
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Reviewed by mir khaleq ali
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04:54
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