Bitcoin, the granddaddy of the cryptocurrency clan, covered itself in glory after finishing at just under $20,000 on December 17. Things went downhill from there, and a low point was hit on February 6, when the digital currency slumped to $6,272. However, the situation has gone on the mend, and the bullish mood is strong with many investors and analysts, among them Tom Lee, co-founder of Fundstrat Global Advisors, Bloomberg reports. Unwavering in his optimism on Bitcoin, Lee project a new peak for the digital currency by July.
According to the analyst, Bitcoin exhibits “V-shaped” bottoms. Lee conducted an analysis that covered 22 corrections of at least 20%, going back to 2010 for his data. The study led him to conclude that “during bull periods, Bitcoin recoveries take 1.7 times the duration of the decline and implies that 85 days are needed to recover prior highs—this is July 2018.”
Bitcoin is currently hovering around $10,000, and Lee has observed improvement in investor sentiment over the past few weeks. While the recent 70% slump is “severe,” there is optimism in the market about an upside and continued resilience for the digital asset.
According to Centtrip analyst Miles Eakers, “Bitcoin’s increase has coincided with the rally in global stock markets.” Reuters cited him as saying that a sustained run above $10,000 may pave the way for a rise to $12,000.
While the market appears to be in good spirits and of strong faith, most regulators continue to fret over the excessive volatility and the risk investors take by trading cryptocurrencies. In addition, some experts and high-profile investors have prophesied a sticky end to the crypto market. Naysayers include Richard Thaler, the 2017 Nobel prize winner for economics, who recently said that Bitcoin and cryptocurrencies in general represent a bubble in an irrational market. Robert Shiller, another Nobel laureate and economics luminary, has also bashed Bitcoin, drawing parallels with the Tulip Mania in 17th century Holland.