Bitcoin has been resurgent lately, climbing roughly 12% so far this week.
The move adds to last week’s 16.3% jump, while bitcoin prices have risen for eight straight weeks.
The cryptocurrency bottomed in early March, a few weeks ahead of the stock market, giving investors a hint that perhaps bitcoin had fallen too far, too fast. Indeed, the assets has been surging over the past two months, now up about 150%.
The rally comes ahead of next week’s halving, which was described earlier on TheStreet:
“In its simplest form, bitcoin halving reduces the amount of tokens miners - the data-hogging computer programmers that validate new transactions and add to the ever-increasing blockchain -- receive for each new 'win' from 12.5 to 6.25 on May 12.”
Trading Bitcoin Prices
Bitcoin caught a big boost earlier this week on comments from legendary trader Paul Tudor Jones. He argued that bitcoin looks like gold in the 1970s and he sees it being a reasonable hedge against inflation.
Jones said, “the best profit-maximizing strategy is to own the fastest horse ... if I am forced to forecast, my bet is it will be bitcoin."
As of this writing, bitcoin prices are hovering just below $10,000 per share. The last few times bitcoin went through a halving, shares ultimately gained in response. With one of Wall Street’s most well-known traders involved, can the cryptocurrency maintain momentum?
Aside from the psychological significance, a move over $10,000 could trigger a larger rally up toward the 2020 highs near $10,500. At this point, this area seems like a magnet for the bulls.
To get there, bitcoin will face the 61.8% retracement for the 52-week range at $10,136. Above $10,500 could put the 78.6% retracement in play at $11,804.
Should bitcoin prices retreat rather than break out, look for support to come into play near the 10-day moving average. Below that mark and the $8,000 area should be significant support. There, bitcoin will find its 100-day and 200-day moving averages.
Just keep in mind, this is a very volatile asset, and big moves can be expected in both directions. While bitcoin may need a break after eight straight weeks of gains, new 2020 highs can’t be ruled out.