Despite the sharp pullback last week, bitcoin looks on track to post its highest-ever monthly price close.
The number one cryptocurrency by market value fell by over $3,000 to $16,242 on Nov. 26, clearing out excess leverage from the derivatives market. The dip was short-lived and prices have recovered more than 50% of the pullback in the days since.
At press time, bitcoin is trading around $18,600 on major exchanges. That’s significantly higher from the peak month-end price of around $13,880 observed on Dec. 31, 2017.
The impending record close could be a harbinger of a stronger bull run, according to some observers. “Every time bitcoin has closed above the previous monthly all-time high, a 700% to 1000% uptrend has followed,” crypto analyst Josh Rager tweeted earlier in the month. Market analyst Lark Davis shared a similar view on Monday.
Bitcoin jumped nearly 27% in April 2017, toppling the previous monthly close record of around $1,150 reached in November 2013. What followed was a steep rally to nearly $20,000 by December 2017. Strong rallies were seen after bitcoin set record monthly closing prices in January and October 2013.
History to repeat itself?
Analysts are optimistic about the ongoing bull market’s longevity, with some pointing to $36,000 as the level to watch once the immediate psychological resistance at $20,000 is scaled.
Factors considered responsible for the recent eight-week rally from $10,000 to $19,400, such as increased institutional participation, hedging demand due to dollar sell-off, a potential rise in inflation and the search for yield alongside a record global stockpile of negative-yielding debt, are expected to continue powering gains in the cryptocurrency.
“People have been saying institutions will get into crypto for years, but it seems that this year, they already are,” crypto…