The last week was quite an eventful one for Bitcoin and its brethren, as prices reached their highest levels for more than a year.
Many anticipated a huge crash once Bitcoin broke the US$8,000 barrier earlier this month. It did retrace a little, falling back twice, but the asset stayed at more than $7,000 both times. Since then Bitcoin has gone on to push even higher to reach $8,900, a price level it has not seen since early May 2018.
By Wednesday, Bitcoin had pulled back slightly to just below $8,500, according to Tradingview.com, but this still means it has doubled in price since early April. So far this year, Bitcoin has made almost 130% gains, far outperforming US stock markets.
The NASDAQ, comparatively, has only managed 14.5% since January 1 and has been on a downward slide for most of this month. Many feel this momentum for Bitcoin has largely been driven by retail-sector investors, as US regulators continue to drag the chain on approval of institutional crypto products.
A large correction is overdue, however, and looking back at previous market cycles indicates it could be as much as 30%, which would drop the current price back to the $6,000 level. During the last uptrend there were eight corrections greater than 30% for Bitcoin, so another one would seem to be on the horizon.
However, a number of analysts are actually predicting the opposite and are expecting a push higher to $9,600, where a heavy level of resistance lies. Indeed, several long-term technical indicators have recently switched from pessimistic to bullish, for cryptocurrencies.
Bitcoin has not been alone with the momentum. Ethereum has also been performing well recently with a 75% gain over the past month to top $270, its highest price since early September 2018.
Likewise with Litecoin – an offshoot from Bitcoin spurned in 2011 – which has been flying lately. Since the beginning of this year Litecoin has made a whopping 280%, surging from $30 to reach a high of $115 a couple of days ago. A technical, mining-based supply cut is due in early August, which is likely to lead to increased demand and higher prices still.
Other crypto assets such as exchange-based Binance Coin (BNB) have also been climbing steeply over the past couple of months. Since the beginning of the year, BNB has surged more than 460% to reach an all-time high of $35.
Many from mainstream finance and media have bashed Bitcoin for the last 12 months by heralding the death of crypto. However, right now, the digital bulls are firmly back in the driving seat.