- The Bitcoin price is hitting the $16,000 mark and could move to an all-time high of $20,000 as a result of a supply shock.
- Despite the parabolic rise, the current rally could be fundamentally different from 2017.
Bitcoin almost hits 16000usd?
Bitcoin investors are currently experiencing a rally that may remind many long-established investors of the bull run of 2017. After trading at just over USD 14,000 yesterday, Bitcoin’s price has risen by more than USD 1,500 over the course of the day.
The last time this happened was during the legendary bull run in 2017. At the time of writing, BTC was trading at $15,764 USD and had already briefly scratched the $16,000 mark.
This means that as Bitcoin almost hits 16000usd it has reached its highest price since January 8, 2018; certain parallels with the bull run of 2017 are currently unavoidable. A strong FOMO(“Fear of missing out”) effect seems to affect the current price movement.
The index has risen from its value of 72 yesterday to 90, which means that the market is now in an “extreme greed” state according to the index. The last time the index exceeded 90 was in June 2019, when BTC reached its annual high of USD 13,900.
Bitcoin is indeed overbought though some experts are not convinced. The founder of Capriole Investments, Charles Edwards, explained that the situation is fundamentally different from 2017, and Edwards pointed out in a newsletter to investors that there was a massive outflow of Bitcoin reserves on crypto exchanges this year.
According to Edwards Bitcoin stocks have decreased by 25%. Supply shock can be triggered by halving dynamics causing lack of tradeable bitcoin among potential buyers.
Via Twitter, Edwards also wrote that 19K is more likely than a slump to 12K at the moment. Edwards pointed out that Square sold twice as many Bitcoin in the 3rd quarter.