As Americans fired up the grills, took to the water and otherwise celebrated a national holiday, Bitcoin was busy.
Looking at a five-day chart shows that after spiking up from around $7000 to around $8000 in the middle of the month, Bitcoin spiked again from $8000 to nearly $9000 over the weekend. After a high watermark on the 27th, Bitcoin stays afloat around $8700, having broken a key resistance at $8400.
“The king of the cryptocurrencies had reached a new yearly record, as well as a new 2019 high after breaking up the $8400 level following a reasonable bullish candle,” wrote Cryptopotato’s Yuval Gov May 26. “In a little more than an hour, Bitcoin surged $800 to capture $8800 resistance as the new 2019 high, as of writing this.”
Bitcoin’s rise is, in some ways, quite stunning. Some even wonder if it’s too good to be true.
“It’s safe to say that Bitcoin has had a stellar year so far in 2019,” wrote Felix Mollen a day later. “The price more than doubled, surging 137 percent year-to-date. With most of the gains made in the last two months, however, it’s perhaps reasonable to wonder whether or not things will end up as they did after the parabolic surge of late 2017.”
With that said, Mollen detailed some key differences between the 2017 run-up and the one happening now.
What followed (in 2017) was more or less disturbing,” Mollen wrote. “2018 was a year of a prolonged bear market where all the gains of the previous year were wiped off existence. Bitcoin plunged to yearly lows of around $3,100, which represented a decline of approximately 85 percent. The entire market suffered, as the market cap capitalization declined from over $800 billion to about $100 billion. This begs the question if history will repeat itself. Looking closer, however, we can see that some incremental changes and differences may prevent this from happening.”
Changes to miner rewards will affect the supply of Bitcoin and may affect markets, too.
Institutional buy-in is also a big factor.
Keep watching the crypto markets as this volatile part of the financial world ebbs and flows with the tides.
