June 14, 2019
By: Steven Anderson
The bitcoin market has had its share of ups and downs in its
lifetime, though for the last year or so, it’s been mostly downs. Just ask
anyone who mortgaged their house to buy bitcoin at $19,000 back in 2017.
However, there are some new signs of life in the cryptocurrency, and new word
sent our way from the deVere Group suggests that bitcoin may well have a new
leg up in store.
The word from Nigel Green, deVere Group’s founder and CEO,
notes that the price for bitcoin recently broke a number figured as a key
support: $8,000. Sure, that’s not half of its height, but it is a significant
return from its 2018 lows in the $3,600 range. What really got Green’s
attention, however, is that bitcoin recovered its price in the midst of a
period of overall low volatility.
Green cites “crypto history,” noting that over the last
several years, whenever there’s been a period of low volatility in the
cryptocurrency market, extended crypto bull runs tend to follow. Green even
cites numbers from just a few months ago; back in February, there was a stable
period for the market, where bitcoin started its March out around $4,200. Not
bad, but by the end of May, the price had more than doubled, hitting $9,090.
Now, Green suggests that another crypto bull run may be in
the making. The combined fact of bitcoin hovering in a $600 range for the last
week coupled with a recent upside gain to push it over the “$8,000 resistance
level” suggested that gains may be afoot.
As virtually any brokerage or even some investment company commercials will tell you, past performance is no indicator of future behavior. However, most will respond with the old saw that, even if history doesn’t repeat, it certainly has been known to rhyme. Observable, repeatable patterns do tend to appear even in investments, so certainly, Green has a foundation on which to base his belief of a new potential bull run in the making.
That said, it wouldn’t be the first time that bitcoin bucked
convention; we may not see a bull run at all. For those who mortgaged their
houses on bitcoin, though, any gain is welcome.