Is the bear market over? Bitcoin & Co. ready for new highs? If the parabolic uptrend is continued, the price could reach $11,000 this month.
via Adamant Capital
After moving sideways for 12 days in a range of $7,000 to $8,300, bitcoin recently broke out to the upside and briefly traded at around $9,000. If the parabolic uptrend is continued, the price could reach $11,000 this month, and go higher still in July. But will it?
In our previous update we suggested these medium term price drivers for the bitcoin price:
- Accumulation by family offices and institutions
- Significant short squeeze (many expected prolonged bear market)
- Investors exiting embattled exchanges via Bitcoin withdrawals
- Non-selling by bitcoin miners as profit margins recover
- Some minor “fear of missing out” from retail investors
However it appears we underestimated one factor: capital flight from China. On May 5th, the Chinese Yuan started weakening against the US dollar, and 13 days later traded 2.5% lower — a huge move in forex terms. Remarkably, that was also the week that bitcoin broke above the resistance of $6,500. In short, there’s a significant chance that in fact it was Chinese investors who pushed bitcoin in bull market territory this year.