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Bitcoin targets $10,000 as halving supply squeeze looms large on horizon



Bitcoin has jumped 20% in the past two days, bouncing against $9,400 to the confused astonishment of investors, enthusiasts, and analysts. From support at $7,800, Bitcoin was supposed to rise over $8,000 but would then encounter such formidable resistance that it would have to retreat and in a hurry. Instead, the world’s favorite digital asset shifted into a higher gear, roared through the $8,000s, and seemed targeted for $10,000 before pulling back to $8,800.

All in all, it has been an incredible April. Bitcoin will print a hefty 35% gain for the month, the fifth straight year that BTC has posted a material gain in said month. One has to go back to 2013 to find a higher performance figure, some 45% in that year. In the process, Bitcoin has effectively recovered its losses in March, doubled the return rate for the year of its rival, Gold, posting roughly 25% for the 2020 period. Despite the fears driven by the COVID-19 pandemic, Bitcoin remains the stellar performer in the investment arena.

BTC/USD Daily Chart courtesy of The Bitcoinist

As always, the question now is what next? Unless you have been sleeping in a cave to wait out the coronavirus, Bitcoin’s halving event will be occurring in less than two weeks when daily miner rewards will be cut in half. The CoinDesk website actually displays a countdown timer on its Home Page, which denotes that we have roughly eleven days to go. There has been a great deal of debate, argument, and speculation as to what might transpire before and after this watershed moment that occurs about every four years, but no one is certain. In any event, FOMO (Fear of missing out) could be taking over at the moment.

Bitcoin

From a fundamental perspective, Federal Reserve chairman Jerome Powell has stated publicly that he is willing to keep the printing presses running, doing whatever it takes to prevent prescribed “lockdowns” from destroying the economy, historically a good sign for Bitcoin. It has been a good sign for stocks too, as the S&P 500 has rallied on the news of his additional support and that progress is being made developing a vaccine. There also was an open “gap” on the CME around $8,500 that has since been filled.

From a long-term purview, however, the upper boundary of the multi-year descending triangle, noted quite prominently on the above chart, will be like a solid brick wall. If Bitcoin is to see $10,000 and beyond, then it must break through this barrier decisively.

In that vein, the folks at Forbes queried Meltem Demirors, chief strategy officer at London-based CoinShares: “I expect bitcoin will see more trading activity around the halving—most likely ‘buy the rumor, sell the news’ and we’re seeing a lot of interest right now—our portfolio companies are reporting high volumes of inbound from firms looking to access bitcoin markets, but the volume is largely in derivatives.”


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Bitcoin targets $10,000 as halving supply squeeze looms large on horizon

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