Bitcoin gains as crypto sentiment improves
In 2018, crypto was the worst-performing asset class losing more than $600 billion of value. The market capitalization of Bitcoin declined from above $300 billion and ended the year at about $60 billion.
In 2019, crypto investors have started the year on a bullish note. The price of Bitcoin has moved from $3558 to a high of $3900. There has been no major news that has contributed to this rally. Instead, the price increase is based on the market sentiment that cryptocurrencies have been oversold.
Still, the industry continues to face major challenges. For example, there has been no major acceptance of crypto in the retail industry. This is because retailers are afraid of accepting a currency whose value can depreciate sharply within minutes. Another challenge is that most cryptocurrencies are still in developer mode and individuals have not been able to apply them in their daily lives. Furthermore, there are fears about the security of digital currencies because a lot of hackings happened in 2018. Additionally, the forking of Bitcoin Cash led many investors to fear crypto because of dilution.
As of this writing, the BTC/USD pair has moved up to 3867. This price is above the 50-day and 25-day moving averages while the RSI has remained above the overbought level of 70. In the coming days, the pair could continue moving up as the sentiment in the market improves. If it does, the next important resistance level it will reach will be the $4000.