Bitcoin “HODLers” are seeing some light in the bear-market tunnel. While it remains to be seen whether it’s the end of this year’s slump, the 20% gain over the last five days has them cheering.
The largest cryptocurrency posted its biggest weekly advance since just before it peaked at almost US$20 000 in December. Other large cryptocurrencies such as ether, ripple, bitcoin cash and litecoin also gained.
Bitcoin is inching back up after it slumped 52% in the first quarter, its worst start of a year ever. The approaching deadline to report taxes in the US, which means investors are done selling crypto to pay off outstanding balances, and a squeeze against a record short position on bitcoin are adding to the rally, said John Spallanzani, a portfolio manager at Miller Value Partners.
Regulatory concerns as authorities from China to the US tightened their grasp in the industry have weighed on prices, while social media giants such as Facebook and Twitter banned advertisements on digital coin sales. There was also speculation that the trustee of failed exchange Mt Gox was selling its bitcoin to pay back creditors.
“News flow had turned less negative on balance, most of the tax selling had finished and there was a sizable short position that had been accumulated so a few large players took note and once we broke above technical resistance it was off to the races,” Spallanzani said. Cryptocurrencies may also be gaining as larger investors enter the market, hedge fund Pantera Capital Management said in a note to investors on Thursday, where they also called a bottom to the current bear market and recommended investors buy bitcoin. Read more from techcentral.co.za…
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