Bitcoin Gets a Buy Signal from Goldman Sachs
Bitcoin’s price tumbled Monday ahead of North American trading, as the largest cryptocurrency continued to retrace from $12,000 after multiple failed attempts to break above that level. Despite the recent correction, bitcoin’s short-term price target is closer to $14,000, according to Goldman Sachs.
The bitcoin price touched an intraday low of $11,194.04 on Bitstamp before correcting higher later in the session. At last check, the BTC/USD exchange rate was down 1.3% to $11,375.
Bitcoin and the rest of the majors actually rallied at the start of Asian trading, as the total crypto market cap returned above $300 billion. The crypto market is currently valued at $296.5 billion and bitcoin accounts for 68.6% of the total.
The largest cryptocurrency has seen a sharp drop-off in trading activity since the weekend. On Monday, verified spot volumes for BTC amounted to just $627 million, according to Bitwise.
Buy Bitcoin? Goldman Sachs Says Yes
Bitcoin’s recent struggles to overcome $12,000 shouldn’t preclude investors from buying the virtual currency, according to Goldman Sachs. In a research note to clients, the investment bank said bitcoin has a short-term price target of $13,971.
Su Zhu, the CEO of Three Arrows Capital, tweeted part of the bank’s note on Monday.
What is more surprising: that Goldman Sachs has a bullish target on $BTC, that they have any target at all, or that they use Elliott Wave Theory?
I'm personally most surprised they cant be bothered to use a chart that includes weekend price action. pic.twitter.com/ocpq7hr0qv
— Su Zhu 🦁 (@zhusu) August 12, 2019
Using Elliott Wave analysis, Goldman said bitcoin would find support at $11,094. From this level, the bulls would target $12,916 and then $13,971.
“Reaching these levels could mean completing a v wave from July,” the bank said. “Bottom line, watch for signs of a short-term top/consolidation once satisfied.”
Since printing a new 17-month high in June, bitcoin has been rejected at $13,000 on several occasions. The last attempt to knock out $13,000 was on July 10. After failing to do so, bitcoin corrected all the way back down to the low-$9,000 range. The price has been trekking higher for the better part of two weeks before running into resistance at $12,000 on August 6.
The virtual currency held its own during a period of extreme volatility in the global financial markets. Some say that the case for “digital gold” has strengthened since the Federal Reserve decided to lower interest rates last month. With global bond markets flashing recession signals, bitcoin’s dominance rate has swelled to nearly 70% of the overall cryptocurrency market.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock. Chart via TraingView.