What will happen to cryptocurrency before the New Year?

Bitcoin will overcome the historical maximum of $ 20 thousand, and altcoins will continue to rise in price, experts expect. They talked about whether it will be possible to buy BTC cheaper, and what are the chances of updating the price records of Ethereum, XRP and TRX

On the night of November 25, the bitcoin market rate rose to a new local maximum of $ 19.4 thousand – very close to historical highs of $ 20.1 thousand. Then the cryptocurrency fell in price and now costs $ 19 thousand. Since the beginning of the year, BTC has risen in price by 150%.

Chances for a new high

Bitcoin has already approached its all-time high and it will not be difficult to upgrade it by another $ 500-1000, says Mikhail Karkhalev, financial analyst at Currency.com. “Now there is a pronounced upward trend in the cryptocurrency market, the growth is almost exponential. This only suggests that the market has a strong imbalance between supply and demand in favor of buyers. Any sales are immediately bought back, and the growth continues,” he explained.

There is little doubt that bitcoin will update its historical maximum by the end of 2020, but no one knows how high the price of a cryptocurrency can rise, says Anatoly Knyazev, co-founder of the EXANTE brokerage company. Among the factors that he cites as drivers of cryptocurrency growth are institutional investors entering the market and PayPal’s addition of support for Bitcoin, Ethereum, Litecoin and Bitcoin Cash.

Updating the historical maximum by Bitcoin may be a “false breakout”, after which a fall to $ 16 thousand or $ 14 thousand is possible, warns trader and founder of Tradunity Dmitry Lavrov. Then the price is likely to return to an uptrend, the expert suggested.

In December, bitcoin should overcome the $ 20 thousand mark and head towards $ 25 thousand, but it will be difficult to explain if the growth towards the intended target occurs without correction, Lavrov said. It is now logical to expect a decline in the price of BTC, as the coin has made a “good move” with minimal pullbacks in recent months, he added.

Wait for the correction?

The bitcoin rate in February-March fell from $ 10 thousand to $ 3.8 thousand amid the collapse of the markets. Then the price of the coin began to rise and in August rose above $ 12 thousand. In September, the growth gave way to a temporary decline, during which BTC fell in price to $ 10 thousand. After that, the upward movement continued, the asset rose another 90%. The dynamics since the March minimum was about 400%.

Correction after breaking the record of $ 20 thousand is possible, Knyazev continued. But in his opinion, it is unlikely to be deep and long. Probably, investors can sell a smaller part of assets in order to lock in profits, but they will keep most of them in anticipation of further growth.

“A deep drawdown, like after the bubble of 2017, should not be expected. In 2017, BTC rose in price 20 times, after which it fell 5-6 times, and in 2020 BTC rose in price more than 2 times,” the expert recalled. He clarified that the May halving prevents the collapse of the bitcoin rate.
Moreover, if the price of the coin drops below $ 16,000, it could attract new buyers to the market.

A possible correction will warm up the interest of market participants, agrees Karkhalev from Currency.com. It’s too early to talk about the beginning of a downtrend – the growth cycle of the first cryptocurrency is likely to continue until the second half of 2021, he said. But this does not mean that you need to mindlessly buy everything, the expert emphasized. He recommended not to forget to hedge risks, as no one knows how the market will actually behave.

Brian Kelly, CEO of the BKCM LLC fund, expects a different development of events. He admitted that bitcoin temporarily reached its limit and in the near future may fall to $ 12 thousand. However, this does not negate the possibility of the coin’s price rising to $ 50 thousand in the long term, Kelly said.

Altcoin season

Against the background of the growth of bitcoin, altcoins showed positive dynamics. Ethereum has risen in price by almost 100% since the beginning of autumn, to the current level of $ 600. The XRP token has gained over 200% of its value over the same period and is now worth $ 0.67. Yesterday, November 24, its price was understood to be above $ 0.9.

Dmitry Lavrov admits that many altcoins may continue to rise in price if bitcoin does not enter a long-term decline phase. In addition, a temporary depreciation of the main digital coin can be useful for an upward movement in the price of altcoins. However, there are doubts that they will be able to renew historical highs this year.

Altcoins will be able to renew their highs if bitcoin continues to rise to $ 30-35 thousand, predicts Karkhalev. Then a new “crypto fever” may begin on the market. Tokens such as XRP or TRX have relatively little liquidity, so a large investment will not be required to increase their price by 300-500%.

The head of the Six Nines data center, Sergei Troshin, expects that in the coming months, the share of bitcoin in the market will begin to decrease – there will be a flow of capital from BTC to altcoins. They are more volatile, and investors looking for rapid growth are not satisfied with BTC alone.

In order for popular altcoins to renew their all-time highs, they must grow by hundreds of percent. For example, Ethereum, in order to exceed the record of $ 1440, needs to rise in price by another 140%. The XRP token should rise another 480% to break the all-time high of $ 3.84.