For the past few days, Bitcoin’s price has shown a remarkable performance in comparison to what was obtainable in January and early February. At that time, the virtual currency was mostly trading around the $3,600 price level and it was less volatile. Of late, it appears to be ready to test December’s high of about $4,000.
Bitcoin Hits $4,000 Price Level on Bitfinex
Yesterday, March 9, Bitcoin went as high as $4,039 on Bitfinex cryptocurrency exchange. There are expectations that it may be willing to retest its December high, and possibly $4,200 to $4300 may become its new resistance test. Moreover, the virtual asset may soon try February’s high of about $4,200.
The latter goes contrary to several predictions that it has found a bottom around $3,000. Nonetheless, it is still too early to make conclusions given that just about anything is possible due to the nature of the market. Bitcoin’s relative strength index (RSI), on the other hand, has also shown positive movements where the asset trades above a 50-day moving average.
Market Gains Momentum, Trading Volume Increases
Other than Bitcoin’s price, the market has gained momentum in the past few hours. While the overall market cap is around $134 billion, Bitcoin has a 51.6 percent dominance which does not come as a surprise. There was also a sharp increase in the trading volume of Bitcoin on Friday and Saturday. Between those days, the market activity was around $10 billion even though as of today, it has declined to $9 billion.
Moreover, Saturday’s $10.7 billion daily trading volume is comparable to that of February 24 where the virtual asset hit a daily high of about $4,200. Therefore, assumptions can be made that the cryptocurrency winter may be drawing to an end. It is also worthy to note that people have started amassing the virtual asset based on its market cap of almost $70 billion as at press time.
Increase in Investors’ Level of Interest
In the same manner, judging from the increase in trading volume and investors’ level of interest, another breakout may just be underway. Cryptocurrency enthusiasts have made predictions in this case with the user, @filbfilb predicting that Bitcoin has the potential of reaching $5,000 by May this year.
Other predictions have even taken it further, that the virtual asset could hit $30,000 by 2021 in the case of AngeloBTC. John McAfee is even seeing something bigger and that is $1 million by 2021. Generally, it can be said that investors are more confident this time around given the turn out of events in the Industry.
Some of these revolve around Fidelity Investments’ launch of a Bitcoin custody platform and Starbucks plans to accept Bitcoin for coffee. Bakkt also has something up its sleeves when it comes to Bitcoin futures and each of these is believed to impact on the institutional adoption of Bitcoin.