Bitcoin reached an all-time high: is now the time to get involved?
By Ali Raza
11:37, 17 December 2020
Bitcoin price behaviour in the last quarter of 2020
Bitcoin's highest price recorded was reached in the past 24 hours, as the coin skyrocketed upwards. The new development is actually only the latest portion of a surge that started in mid-October this year.
After trading sideways for quite some time, the Bitcoin price started growing around October 19. It first broke a resistance level at $12,000 and then $13,000.
The Bitcoin price trend continued in the days and weeks to come, as the coin quickly surged up to its next major resistance at $16,000. This level stopped the price progress for about 10 days in early November, only to break around November 12. After that, the price skyrocketed once again, this time soaring all the way up to $19,000. This was the first time the coin had reached such a level in three years, and the development brought quite a bit of excitement to crypto investors and traders around the world.
Those who invested in BTC when it was at a similar height saw an opportunity to sell without suffering massive losses, while recent investors got an opportunity to earn. However, a great amount of institutional interest in the coin gave a lot of people hope that BTC might truly keep growing to a new all-time high.
Previously, the highest price Bitcoin ever reached was recorded in the second half of December 2017 when the coin hit $20,000. Predictions for the new all-time-high expected the coin to hit $50,000, $75,000, or even $100,000. There were other forecasts that attempted to give an even more optimistic Bitcoin price outlook, although the predictions of BTC hitting $1m in the days to come did seem quite unrealistic.
In any event, BTC broke the $19,000 level around November 25, and while many expected it to keep going to $20,000, the reality was somewhat different. The price did not progress further up. Instead, the coin saw a dip to $16,600. Fortunately, it found strong support right below this level, which kept it from dropping further.
The support actually did more than that, as it provided it with a strong foothold that allowed it to launch another surge. This time, the coin also managed to reach and breach the $19,000 level, and even surge to around $19,600. Unfortunately, the resistance at $20,000 ended up being too strong and the coin did not manage to go all the way to this milestone.
Bitcoin's value got rejected once again on December 1 and, while it tried to hold on, it started dropping again pretty soon. By December 11, it dropped to near $17,700.
At the time, most believed that this was it, and that BTC would only keep spiralling downwards. Fortunately, this was not the case. In the past six days, the coin has been surging up, with a particularly strong rally taking over yesterday.
The rally led to a new highest Bitcoin price of all time, which is where the coin sits right now. Today, for the first time in history, Bitcoin hits record above $20k, officially standing at $23,436 at time of writing.
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Why has Bitcoin reached an all-time high?
Bitcoin price latest news shows that the coin is delving deeper and deeper into uncharted territory. The BTC price has never been this high before and there is no telling how far it can go before losing its momentum and seeing a correction.
Of course, all of this did not really come out of the blue. While there were no specific news developments, or anything regarding the coin's fundamental price analysis that would have caused the surge, there were many positive developments for BTC throughout the year.
For example, 2020 was marked by an institutional interest in the coin, as companies such as Grayscale and Microstrategy noted a record demand for BTC among institutional investors. Reports at the time claimed that these two firms are buying coins faster than miners can produce them. This scarcity is undoubtedly one of the reasons why BTC is rallying throughout the year.
Another reason is the Covid-19 pandemic, which started yet another financial crisis. While the crisis has yet to be felt in its entirety, many influential individuals have advised shifting to Bitcoin in order for people to preserve the value of money.
The fact that BTC recovery started rather soon after the mid-March crash only confirmed that the coin can be reliable in times of crisis.
Then, there was the mid-May Bitcoin halving, where block rewards got cut in half. This is yet another development that ensured BTC scarcity and the growing value of the coins. In fact, BTC halvings have always led to strong price surges throughout BTC history, even though that history is not particularly long at this point.
Over the summer, BTC mostly traded sideways as the price could not gather up enough strength to breach some major resistances. However, that once again changed in the second half of the year. In fact, news such as PayPal adding support for BTC and a few other coins drove adoption, rumours, Bitcoin price analysis and more. More recently, even PayPal's own stock soared to a new all-time high due to the demand for BTC that the platform has started seeing in recent weeks.
The coin certainly did not lack attention, especially since JPMorgan announced that it sees $600bn demand for BTC from global institutional adoption. This is yet another reason for institutional and retail traders to rush to gather as many Bitcoins as possible.
In the end, the reason for the BTC price rally appears to be pure demand and nothing more. The demand has been building up throughout the year and there are many who were waiting for this to happen for three years now. This is simply when and where all of this finally fits together, and when the coin finally touched the $20,000 mark – the floodgates were open, and the wave of investments and purchases kept carrying the BTC price away.
Bitcoin price analysis: what happens next?
Naturally, only one thought now dominates the minds of investors and traders around the world, and that is – what happens next for Bitcoin?
Bitcoin price prediction is a hot topic now, as everyone wants to know how far the coin will keep going, and when it is safe to invest. While there are no guarantees that any prediction is actually correct, there are many worth looking into.
TradingBeasts, for example, predicted that the coin's price in January 2021 will be $16,600 on average, while the maximum price would sit at $20,840. This is still possible, of course, if the coin sees a strong correction in the near future and the rally doesn't continue for long.
TradingBeasts further predicts that the coin could end 2021 with a price of $19,113. Their long-term predictions say that Bitcoin's average price would hit $23,297 by December 2022, while the maximum price could be at around $29k. The price would then continue to surge throughout 2023, according to this BTC analysis, which put the coin's average value at roughly $28,000 in December 2023.
Wallet Investor believes that the coin will hit $21,200 in December 2021 and that it will be just shy of $30,000 by December 2025.
Finally, there is Bitcoin analysis by CryptoGround which expects BTC to crash down to $12,500 by December 2021 but surge up to $29,300 in five years.
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