- Published: Sunday, 18 May 2014 07:15
- Written by Editor
For the next week or so only, the Bitcoin Reporter Market Reports will be shorter than usual.
As previously reported, after two weeks trading in a channel between support at $431 and resistance at $452, against a backdrop of contacting volume and volatility, the exchange rate has broken above the medium term down trend line and continues to move ahead supported by strong bids. If this continues, the market is set to break to the next phase of the long term bull market.
The Bitcoin exchange rate has now broken convincingly through resistance at $452 supported by a burst of buying on better than average volume, well and truly keeping the bears at bay. If BTC maintains this momentum, the previous resistance level of $452 will become the new support level, as the exchange rate continues its move beyond the medium term down trend, heralding a turn in the trend towards a new phase of the long term bull market.
The fundamentals for Bitcoin have never looked better with many well known figures from all sectors, including government, speaking robustly about the importance, value and future of Bitcoin. The Winklevoss twins who are said to own around 1% of all issued Bitcoin have claimed that the market capitalisation of Bitcoin will become larger than Facebook, a statement with which Bitcoin Reporter completely agrees. With the current market cap of Facebook, and number of Bitcoin in circulation, this would imply a current exchange rate of around $15,000 per Bitcoin, which, taking all other factors in to consideration, looks very low relative to the ultimate potential yet to be realised.
Another area of considerable support for Bitcoin is is venture capital investment, with Bitpay receiving another hefty round of investment from some very high profile business people and investors. Investment in to all sectors of the Bitcoin industry continue apace and set to increase exponentially as the full potential of Bitcoin is fully recognised.
The future of Bitcoin as the de-facto global monetary and payment system for the Internet and smart phones is assured, replacing the likes of Paypal and credit cards. It will only be a matter of time until Bitcoin spreads to the offline world or bricks and mortar, as it already is, then surely Bitcoin as the de-facto global currency and store of value an become a reality in the future, ending the domination and gross abuse of fiat currencies by governments, banks and corporations once and for all, thus freeing the world from tyranny and control.
Bitcoin Market Outlook
As can be seen from the year to date chart, the Bitcoin exchange rate continues to trade increasingly above the medium term down trend line. The down trend has been broken, the question being can this be sustained for a while to confirm the arrival of the bulls and beginning of the next phase of the long term bull market,
There is every indication, technical and fundamental that this will be the case, the only caution being that due to the lack of liquidity all it will take is a large seller to crash the exchange rate back down again.
Once the up trend is clear the exchange rate could increase dramatically as the shorts cover and all those sitting on the sidelines buy in to profit from the next bull run, which could be lengthy and take BTC back towards an all time high towards the end of this year.