Cryptocurrency Investors Say Bitcoin Screaming a Buy from Technical Charts
Despite the ever-plunging prices of cryptocurrencies since their mammoth rise in December 2017, Pantera Capital’s Dan Morehead maintains a favorable view, and believes that bitcoin should be bought “while still cheap.”
Actual Belief or Selfish Benefits?
While the San Francisco-based investment firm deals only in cryptocurrencies, Morehead lent insight into his long-term price targets of bitcoin on CNBC:
“All cryptocurrencies are very cheap right now, it’s much cheaper to buy now and participate in the rally as it goes.”
The pioneer cryptocurrency traded at $19,000 in December 2017 and then declined to a low of $5,900 in March 2018, registering a 68 percent decline over three months. Bitcoin trades at $7,500 at the time of writing. However, the cryptocurrency investor believes that the volatile digital asset may have reached its bottom and prices can only go up from here.
Without a doubt, some of the most telling features of cryptocurrencies remain their volatility and the largely unregulated nature of the digital asset sector. But, Morehead thinks that this aspect can help early-adopters and investors, by effectively giving them a head start.
The investor added that institutional investors and quality-regulated custodians are already taking positions in cryptocurrencies, while “buying the rumor” of crypto-friendly SEC regulations and “selling the fact.”
Despite his rather obvious statements, Morehead gave a single technical tip to investors: purchase a digital asset when its 230-day moving average is breached, sell after a year, make an average of 239 percent profit. While the claim remains untested, Morehead referred to the blue line as shown in the chart below:
(Source: TradingView)
While Morehead did not include a timestamp for the chart, BTCManager used a daily candlestick pattern to test his strategy. As it stands, if one were to purchase a single bitcoin on January 1, 2017, at $984, and sell on January 1, 2018, at $13, 718, the total percentage gain would be 1,294 percent, a figure much above Morehead’s average. He added:
“That’s the essence of this trade: It rarely ever gets cheap to its long-term average. So today is a good day to be buying.”
Institutional Trader Echoes Morehead’s Thoughts
While the Pantera Capital founder has vested interests in the price of bitcoin, Robert Sluymer of Fundstrat Global is neutral in that sense as Sluymer’s company is a traditional finance investor house. However, the Fundstart executive agreed with Morehead’s bitcoin prediction of having reached the bottom. Sluymer, the head of technical strategy at Fundstrat, said:
“We think Bitcoin is starting to bottom off some very key support around $7,000 and we think it’s going to start a recovery process here.”
Incidentally, bitcoin danced around the $7,000 level in the last week of May 2018, before recovering to its current price of $7,500 at writing.
Unlike Morehead, Sluymer referred to the relative strength index (RSI) on a bitcoin chart, which showed an “oversold level” on May 28, 2018, indicating a “bottoming phase taking hold.”
(Source: TradingView)
The RSI is a momentum indicator that measures the speed and rate of change of an asset’s price movements, typically over a 14-day market cycle. Sluymer concluded:
“We think the setup is very attractive here. If you’re short we think you should be very careful and reducing your short exposure. I think if you’re looking to be long this is where you start adding here to your long exposure.”
The post Cryptocurrency Investors Say Bitcoin Screaming a Buy from Technical Charts appeared first on BTCMANAGER.
Source: BTCManager.com
Original Post: Cryptocurrency Investors Say Bitcoin Screaming a Buy from Technical Charts
