Bitcoin Rally Converts Staunch Bear, Sees Price Breaking Above US$8,000
Originally published on: CCN
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July 19, 2018
Whether it is FOMO or a conscious judgment, bitcoin bears seem to be fastening their seatbelts for a ride to the moon too.
According to Boris Schlossberg, the managing director of FX Strategy at BK Asset Management, the fact that bitcoin had broken above the US$7,000 level was a possible indication that there was still more upside potential. Per Schlossberg, who has been a longtime bitcoin bear, technical analysis was playing a bigger role relative to fundamental analysis.
“The asset is trading much more on technical rather than fundamental considerations. And the shortcoming rally has scope to go even further…” said Schlossberg on CNBC’s Trading Nation.
Resistance in Sight
Schlossberg is now of the opinion that the cryptocurrency could rise above US$8,000. The foreign exchange strategist, however, warns that this is where serious resistance will emerge if and when the price reaches that level.
Besides the technical drivers, other catalysts that Schlossberg cited as having brought about the bitcoin rally included the revelation that the world’s biggest asset manager, BlackRock, was considering investing in bitcoin futures. Additionally, the asset management firm was exploring cryptocurrencies in general as well as blockchain technology.
Yet another catalyst from mainstream Wall Street was Steve Cohen, a hedge funder, who was recently revealed to have invested in a cryptocurrency hedge fund. Per Schlossberg, bitcoin also stood high chances of further appreciation if the adoption of blockchain technology by the mainstream financial sector increased since it would help in enhancing bitcoin’s ‘digital gold’ reputation.
The Worst is Over?
Others who are also holding a bullish sentiment for bitcoin include Barry Silbert, the founder of New York-based venture capital firm Digital Currency Group. Earlier this week, Silbert told CNBC that bitcoin breaking above US$7,000 was a strong indication that the flagship cryptocurrency had finally bottomed out.
Also this week, Digital Currency Group’s subsidiary Grayscale Investments announced that interest in bitcoin from institutional investors was growing. According to Grayscale, the firm was getting new investments totaling close to US$10 million every week for all its products with Bitcoin Investment Trust witnessing average weekly investments of slightly over US$6 million. About 56% of the investors were institutions.
Additionally, the co-founder of investment firm Avenue Capital Group, Marc Lasry, earlier this week predicted that bitcoin could be worth US$40,000 in the next couple of years as the adoption rate rises. Lasry, who is also the owner of basketball team Milwaukee Bucks, is estimated to have invested $17 million in bitcoin in his personal capacity.
The price appreciation of bitcoin this week also coincided with the announcement by Goldman Sachs that David Solomon, who is considered more crypto-friendly compared to Lloyd Blankfein, will be succeeding the latter as the CEO.
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