A Surge In Cryptocurrency Is Now Expected
After several false starts Bitcoin, the worlds reserve cryptocurrency, has finally snapped its downtrend. The coin gained more than 20% in two days, breaking above an important downtrend line, as investor confidence returns. The coin has been trending lower for the last several months as scams and increasing regulation kept the market at bay. Now that those woes have worked their through the system traders can focus on fundamentals that point to widening acceptance of blockchain based technology.
What happened to effect this change in the market? There was no major news event to cause a market reversal but there was a development within the market that did, the downtrend ran its course. The market hit a key support level, a level that just happened to equal the mining cost of BTC, and that level held. It held not once or twice but over the course of several weeks and months. Each time that level was hit, near $6,675, prices bounced as traders scooped up new tokens at cost until, finally, there were no more sellers left in the market.
This is important for two reasons. The first is that selling pressures will abate and allow the price of Bitcoin to begin drifting higher, back towards its true market value. The second is that, now that the bear market is broken, all those bearish traders will begin to trade bullish. These factors will combine to form a rally in BTC that will easily take it back to $12,000 with a real possibility of retesting the all time highs near $20,000. In the near term the coin appears to be consolidating above the 30 day EMA in preparation for its next move higher.
Bitcoin resurgence has the entire cryptocurrency market moving higher. The biggest gainer in terms of market cap is Iota which gained roughly 50% in the three days ended Friday, 13th April 2018. This token is a next-generation technology similar to blockchain but inherently very different. It uses a “tangle”, a sort of multi-channel distribution network, that allows transactions to be processed without the need for blocks or miners. The token is still trading for less then $2.00 but is likely to see big gains over the next few months. The all time is above $5.50, 360% above today’s trading price, and likely to be retested if not surpassed as the technology’s use widens.
Another digital token making big moves is Omisego. Omisego is an Ethereum powered blockchain technology linking merchants, financial institutions and consumers across Asia. It has surged nearly 100% in the last three days as traders flood back into the token with the expectation it will go live later this year. A move back to $18 is likely over the second half of April 2018 with a move up to retest the all time highs likely before summer.