Are you curious about investing in Bitcoin? Well, you are in the right place. This is an analysis and price prediction of Bitcoin for December 2020.
Bitcoin (BTC) is the number one cryptocurrency by market cap and also the most valuable among the top cryptocurrencies. Created in 2009, the digital asset has a return on investment (ROI) of over 9,000%. Even if it has faced a lot of resistance in the past, this is becoming a thing of the past, as BTC continues to beat other investments, such as gold, which is centuries older.
Though Bitcoin’s market cap is still only a fraction of gold, this is expected to change in the near future as more investors continue to flock to the asset. In the last 24 hours, $37,257,630,217 worth of Bitcoin has been traded. With a market cap of $318,118,607,905, BTC currently has a circulating supply of 18,546,000 BTC coins out of the total maximum supply of 21 million coins. With less than 3 million coins left to mine, analysts believe that Bitcoin could become the scarcest asset in a few years.
Bitcoin Price Prediction: Analysis
Bitcoin has been in an upward trend since the year 2020 started, except for the dip in March, which took the price below $5,000. The dip referred to as black Thursday was caused by a massive sell-off towards the third Bitcoin halving in May. Since then, however, the upward trend has resumed, and the price has surged steadily. Bitcoin is now priced at $17,152.95, with an increase of 4.8% in the last 24-hours.
As the upward movement has been on for days, a look at the daily chart of BTC/USD shows a Relative Strength Index (RSI) of over 74. This indicates an overbought condition, a condition that could lead to a pullback in the short term. However, the general market sentiment remains bullish both in the long and in the short term.
This is also clear from the Moving Averages (MAs), with the lower time frames being above, the longer time frames, as shown below. A Golden Cross recently occurred on October 27 when the 50 MA crossed above the 100 MA. The gap between the two has been widening since then, indicating that the bullish trend is far from over.
If you are a trader, here are key support and resistance levels calculated by Walletinvestor that you may find helpful in determining your entry and exit points:
- Resistance Level (R3): 17974.27;
- Resistance Level (R2): 17395.03;
- Resistance Level (R1): 17053.47;
- Pivot Point: 16474.23;
- Support Level (S1): 16132.67;
- Support Level (S2): 15553.43;
- Support Level (S3): 15211.87.
As Bitcoin price continues to surge, there is also a growing interest and optimism in the asset. A Citibank analyst projects that the coin could reach a value of over $300,000 by the end of 2021. He compared the current Bitcoin market to the gold market of the 1970s, when it was just gathering momentum for phenomenal growth. The analyst, Thomas Fitzpatrick, who is also the global head of the company’s CitiFXTechnicals market insight product, used technical analysis of Bitcoin’s past price swings to forecast a $318,000 price by December 2021.
He also attributes Bitcoin’s massive price projection to a decoupling of gold from fiat currencies, the COVID-19 pandemic and the desire for central banks to pursue aggressive quantitative easing policies as factors that could help to drive the price to this height.
Bitcoin Price Prediction: Market Opinion for December 2020
Below are price predictions from some of the most reputable price prediction websites. These could help you understand where the price is going in the coming month.
Longforecast is bullish on Bitcoin. The website predicts an increase in the price of 54.5% in December 2020 to reach a maximum of $23,498 after opening the month at $18,933 and to close at $21,325. The least expected price is $16,563.
Unlike Longforecast, Tradingbeasts projects that Bitcoin will open December bearish at $14,256.846, which means that it will be below the current price of $16,000. The maximum expected price is $17,937.257, while the minimum price is $12,197.334. The website also foresees Bitcoin to close December at $14,349.805
30rates sees Bitcoin opening December at $18,068. Although it has not predicted a closing price, it is clearly bullish, as the price is expected to reach $21,961 on 21 December. Below is a table showing the forecast for the first 21 days.
Bitcoin Price Prediction: Verdict
Bitcoin is clearly in a bull market, although not everything is smooth. While this is not investment advice, analysts believe this is one of the best times to invest in the asset. However, this may require some level of independent research and calculation to make a profit in the short term, as the price can change direction fast.