Crypto Markets in Search of Direction as Wall Streets Calls Bitcoin’s Bottom
Digital currencies were little changed on Friday, as a lack of trading catalysts kept market participants on the sidelines indefinitely. However, a new survey from Fundstrat Global Advisors suggests that the worst of bitcoin’s epic price collapse may have already passed.
The cryptocurrency market capitalization hovered between $217 billion and $220 billion on Friday as trade volumes continued to decline. Trading volumes have plummeted nearly 30% over the past week.
Bitcoin continues to hold below $6,600 after exhibiting narrow price movements over the last 24 hours. At current values, BTC comprises 52.1% of the overall market, according to CoinMarketCap.
With the exception of XRP, all major coins in the top-ten saw narrow price movements on Friday. Ethereum continues to hover in the $220-$225 range, bitcoin cash was valued at $515 and EOS was little changed near $5.74.
Analysts believe the launch of Bakkt could tip the scale in favor of the bulls over the next two months. Bitcoin’s firm price floor near $6,000, combined with growing institutional interest, could push prices higher before the end of the year. That said, the bears continue to sell the rallies, with each major recovery attempt shallower than the previous. This is demonstrated by bitcoin’s lower highs in recent months.
Has Bitcoin Bottomed?
Financial institutions and the broader public diverge sharply on whether the price of bitcoin has bottomed, according to a new survey conducted by Fundstrat Global Advisors. Tom Lee, who heads Fundstrat’s research department, polled 25 institutions and compared the results with a Twitter survey of 9,500 people. As CNBC reports, 44% of Twitter respondents said bitcoin has already bottomed while 54% of institutions say the worst is already over.
Institutions were also more optimistic about bitcoin’s future trajectory, as 57% said BTC could launch above $15,000 by the end of next year. By contrast, only 40% of Twitter respondents expected a similar breakout.
Although Lee maintains that bitcoin could return to record highs this year, a replication of last year’s bull market is unlikely. As Hacked’s Ken Chigbo recently pointed out, a lack of historical technical levels supported bitcoin’s breakout in 2017. The picture is vastly different today with the coin facing several resistance barriers that are based on supply/demand factors as well as investor sentiment.
Bitcoin has recorded back-to-back monthly declines but a recent technical break pointed to favorable short-term conditions. The leading digital currency has struggled to extend a recent rally that took prices to $6,650 as volatility fell to fresh yearly lows.
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.
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