Within a ten-day span, the cryptocurrency market added $45 billion to its valuation as Bitcoin surpassed $4,200.
Most analysts have made positive predictions on the short-term price trend of Bitcoin heading towards the year’s end. Many investors are confident that the dominant cryptocurrency has established a bottom.
Prospect of Bitcoin
Bitcoin, Ethereum, Ripple and the vast majority of cryptocurrencies are undoubtedly in a bear market. Bitcoin’s price is still down by 79 percent from it’s all-time high and other major crypto assets such as Ethereum (ETH) and Ripple (XRP) are down by around 89 percent from their all-time highs.
Ethereum’s price surged by more than 51 percent against the U.S. dollar on December 23. Economist, Alex Kruger said –
“7 days ago ETH was down 94% from all time highs. Now, after a 52% increase in 7 days, ETH is only down 91% from all time highs.”
However, most investors are still skeptical about investing in the crypto market. To turn the situation around and have investors reasonably believe that cryptocurrencies are no longer in a bear market, digital assets would have to increase by over 20 to 30 percent against the USD.
The current value of Bitcoin is at around $4,200 on fiat-to-cryptocurrency exchanges. While Bitcoin has broken out of several resistance levels above $4,000, a breakout of $5,000 is important to confirm a proper bullish price movement, as analyst Willy Woo explained earlier this month.
“Be aware the above scenario is contingent on a bounce upwards to test low $5,000s. Currently, the short term price action is consolidating into a wedge with hidden accumulation (according to the OBV indicator), this suggest there is more probability of an up move from here.”
Bitcoin reached $3,120 this year; the lowest point in 2018 which was an 84 percent decline from Bitcoin’s all-time high. However, to confirm a full trend reversal, the asset would have to show strength throughout the first quarter of 2019, demonstrating several months of consolidation and accumulation.
Ethereum co-creator, Joseph Lubin, emphasized that the crypto market has achieved a bottom, but it is too early to conclude that the bear market of cryptocurrencies has come to an end.
The strong corrective rally of major digital assets has relieved significant pressure from the cryptocurrency market, increasing the probability of a potential trend reversal and positive price movements over the Christmas season.
The cryptocurrency market has recorded an increase in valuation from $100 billion to $145 billion, by 45 percent, since mid-December.
However, in a grand scheme of things, the cryptocurrency market has not even reached November levels, when the valuation of the market was hovering at $220 billion. The market should rebound by 51 percent to recover to $220 billion.
With several positive industry-related developments, including the launch of the Bakkt Bitcoin futures market in January, investors in the market are anticipating a solid price movement throughout the first two months of 2019. For maximum profit from trades, investors are turning to exchanges with low transaction fees. PCEX offers a transaction fee of 0.05%, the lowest fee in the market.