We’re starting off this week with the price of Bitcoin near the $1,270 mark as seller pressure has lead to some corrections of the rising trend that began last week. As the weekend approaches, Bitcoins are expected to stay strong in the face of the ETF approval this Saturday. However, like always, there will be traders looking to profit on this major price boost, so don’t expect a smooth week, after all.
Other news that this week also brought was those of a darkweb seller who is reportedly looking to trade over 1 million accounts from Gmail and Yahoo for a price of less than 1 Bitcoin. The cyber criminal, believed to be hiding under the username “SunTzu583”, is trading accounts from several data breaches, including ones from as early as 2008.
According to IBT, among the accounts batch are usernames, e-mails, and passwords from the MySpace (2008), Last.FM (2012), Adobe (2013), Bitcoin Security Forum (2014) and Dropbox hacks, among other cases. The breached accounts are most probably going to be bought by any groups or individuals looking to use them for identity thefts, ransoms, etc.
Bears Look for Profits
During the weekend, the price of Bitcoin struggled to form support at the $1,280 level as both sellers and buyers swooped the market. After reaching a new milestone on Friday, there have been several price swings that allowed the price to move from its weekend high point of $1,277.68 to as low as $1245.21, after which it recovered to the current levels.
The price drops coincided with a loss in interest, as the trading volume went down by two thirds to the current $130,236,000. However, there has been a small uptick since last night, so if it goes high again, there will be more room for faster price changes. On the other hand, the market cap sits at $20.6 billion.
Our technical analysis shows that the long-term trends are heavily pro-buy, which is great news for those who want to see the price growing. However, short-term signals are also showing that 5 out of 12 oscillators and 5 out 12 averages are in the sell zone, indicating a formation of seller pressure.
Thus, the overall signal is that the price is headed for a slow growth, as long as sellers don’t keep pressuring the market. If they do, we will see a test of the $1,260 range. So, keep your eyes on the market and don’t be surprised by more price swings.
Bitcoin or Gold?
During the past week there has been plenty of talk whether Bitcoin has become a better alternative to gold in the eyes of investors. One interesting comparison comes from Forbes, who report that Bitcoin Investment Trust Shares have grown almost three times during 2016, or over 30% in the past quarter alone, while Gold Shares (SPDR) have dropped down by 3.78% in the year, and 4.49% in the last quarter.
The positive and impressive rise coincides with the increasing mistrust in fiat currencies which has subsequently resulted in people turning to Bitcoin. In the past year, there have been several instances where problems with traditional currencies have caused an uptick in Bitcoin trading, the most notable being the demonization in India and Venezuela where Bitcoins are rapidly gaining popularity.
This, combined with the practicality of Bitcoin and its limited supply, is perhaps the only logical explanation why Bitcoin has grown so fast and so big in the past 6 months alone. However, being the complex digital currency that it is, it is likely that most of its appeal lies among the Millennial generation, rather than older investors.