Bitcoin Heading to $13,000; Facebook Not the Only Reason

The world’s number one cryptocurrency by market capitalization has been on fire lately, marking incredible gains week after week. In only seven days since our previous price update, Bitcoin has steadily grown from $9,200 to get close to $13,000 today. And judging from the current signals coming from the market, the price increase won’t be stopping soon.

As reported by Investopedia, Bitcoin’s price push is also driving a rally in Asia where cryptocurrency stocks are growing, showing resistance to skepticism about the future of the global crypto market. In Japan, the stocks of GMO Internet increased by 7% on Monday while Remixpoint, Ceres, and Metaphs noted jumps of 6.2%, 4.4%, and 11%, respectively. Similar increases were also noted in South Korea where a number of crypto-companies saw their stock’s value jump higher together with Bitcoin’s price.

According to George McDonaugh, co-founder and CEO of KR1 Plc, Bitcoin’s return only goes to show that money hasn’t left the coin, but that it “just sat on the sidelines”, patiently waiting for the right moment to jump right in. With the current state of the market, some analysts are again predicting a $50,000 target in the future.

High Volume and Bullish Signals

In the past seven days, Bitcoin has marked some incredible gains, crashing one barrier after another as it neared a price point of $13,000. The lowest USD price the coin hit during this period was $9,268/53 last Thursday, while the highest price was reached today morning, when Bitcoin hit a new 2019 peak of $12,867.79. Like with the previous price jumps, the trading volume exploded during this time, even hitting $29 billion at one point. Currently, the volume is at $31 billion and rising, hinting at another price increase, while the market capitalization is at $226.5 billion.

As our technical analysis shows, Bitcoin looks headed for a break of $13,000 today as the market signals are strongly bullish. Out of 12 technical oscillators, 7 are sending green signals, showing buyers hold the market, while all 12 moving averages are pro-buy. The SMA 100 is well over the SMA 200, showing less resistance on the upward path, and short-term signals are also very bullish. However, RSI and Stochastic are already in the “overbought” zone, hinting that bulls may be getting tired. If the trends don’t change, expect the coin to hit a new 2019 record soon.

“Halvening” Behind the Price Surge?

Although there are many theories as to why Bitcoin has been rising so fast over the past few weeks, one particular theory is getting plenty of traction with industry analysts. According to CNBC, Bitcoin’s impressive growth over the last month could very well be due to the upcoming “halvening” of miner’s rewards. By the end of May 2020, miners producing new coins will have their rewards cut in half, which in turn should drive the price up even further.

As envisioned by Satoshi Nakamoto, approximately every four years the supply of Bitcoin is cut in half, tightening the liquidity and subsequently pushing the price higher. Currently, miners are rewarded with 12.5 coins per block – a prize which will be cut to 6.25 the following year. The “halvening” will also affect Bitcoin’s inflation rate, cutting it down from the current 3.76% to 1.8%.

As with other “halvenings” before it, traders are most likely seeing the potential of the event and are investing to reap the rewards later. So far, 80% of Bitcoin’s 21 million limited supply has already been mined, although the hard cap is not expected to be reached for another century.

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