Is it a good time to buy Bitcoin or Sell It? Check Our Analysis
Is it a good time to buy Bitcoin? Bitcoin has breached $23,000 and the current momentum of Bitcoin is Bullish.
Is it a good time to buy Bitcoin? Yes, if your Investment Horizon is 3 to 5 years
Bitcoin is up 10% since we first posted this analysis. It is also up 24% from the bottom on June 18th. Our forecasts suggest Bitcoin could rise 25-30% higher for the rest of the year.
Is it a good time to buy Bitcoin? Bitcoin Recovery
- Brent Crude’s crash from $125 to $100 in 3 weeks is helping Bitcoin. While Brent crude oil has traded 6% lower in the last 5 days, Bitcoin is up 14%.
Why is the comparison with Crude Oil Important?
A higher crude oil price is a surrogate for higher gas prices which in turn leaves lesser money with investors to trade in cryptocurrency.
- BTC has value both in terms of a store of value as well as currency for payment. It sure isn’t where Gold is or where the Dollar is at the moment but it is headed that way.
- Bitcoin prices are related to disposal incomes and liquidity as the willingness to try a relatively new store of value or currency goes up when there is enough liquidity. The recent fall in Bitcoin price is related to falling liquidity. Historically, liquidity improves at some point in time and hence one can say Bitcoin will recover as liquidity returns to the market
- Weaker holders of Bitcoin have exited over the last 7 months and some more will exit in the next few weeks. With only the strong and those who invested at these levels remaining, BTC will gradually recover
- Some compare Bitcoin to the Tulip Mania and others to the Dot Com Bust. But the fact is that the Tulip Mania and Dot Com boom lasted about 3 years each. Bitcoin has been tested repeatedly over the last 12-15 years in this modern age of computers and boom and bust cycles. So yes, the comparison is incorrect and Bitcoin will recover again.
Is it a good time to buy Bitcoin?
Yes, it is a good time to buy Bitcoin for long-term investors (3 to the 5-year horizon) as the prices have fallen significantly. However, a few caveats
- While there is some evidence of Bitcoin having reached the bottom for the year, it is not definitive.
- The factors in favor include the Supply of Bitcoins to the exchanges has fallen, Whale purchases have surged, Crude Prices have fallen in the last 3 weeks and some Technicals are suggesting a Bitcoin bottom
- But the Macros don’t favor Bitcoin yet. We do not have visibility on inflation or on how much more the Fed will squeeze the Liquidity.
Therefore, the risk of Bitcoin falling further still remains. However, the risks are lower than it was three weeks ago. An Investor willing to handle the risk of a move lower could invest now.
Is it a good time to buy Bitcoin? What are others saying?
Many are arguing that Bitcoin’s rise in the last 2 follows a rise in the NASDAQ. The NASDAQ is up 5% since Tuesday.
Other analysts are arguing that while Bitcoin may not fall further, it will not rise significantly either.
The last perspective is that the current rise is a fake-out and Bitcoin could actually fall further.
Note: Crowdwisdom360 collates Predictions and data from all over the net and has no in-house view on the likely trends in the Index or Individual Stocks. Please consult a registered investment advisor to guide you on your financial decisions.