Market Watch – 16 November 2020

  • Bitcoin is surging past the $18,000 level, approaching record level prices. representing a 150% year-to-date gain, according to The CoinDesk 20.
  • Citibank analyst seemingly predicts $318K Bitcoin price for 2021
  • Grayscale survey connects COVID-19 pandemic to new Bitcoin purchases

Citibank analyst seemingly predicts $318K Bitcoin price for 2021

A recent Bitcoin (BTC) technical analysis reportedly prepared by CitiFX for its institutional clients points to a potential high of $318,000 sometime in December 2021.

In a supposed note to clients seen by Twitter commentator Alex on Nov. 14,  Citibank managing director Tom Fitzpatrick looks at the long-term trend of Bitcoin price, characterized as it has been by “unthinkable rallies followed by painful corrections.”

Notably, the three major bullish periods of BTC so far have been increasing in length. Initially, there was a 10-month run from 2010–2011, followed by a two-year run from 2011–2013, and finally a three-year run covering 2015–2017.

This analyst called Bitcoin’s new price high in 2020 three months ago 

As noted by consumer investment service Swan Bitcoin on Nov. 18, the co-founder of The Investor’s Podcast Network, Preston Pysh, predicted 90% end-of-year returns for BTC/USD when the pair traded at $11,400.

Pysh: 2020 gains could be “insane”

“You should be making a new all-time high by Christmas 2020. That means we’ve got 80–90% upside from here, which is insane, right because there’s not that many more months between now and Christmas,” Pysh said during an episode of the company’s Swan Signal podcast.

He added that gold would fail to match “anything like” Bitcoin’s growth, something that has since come true as the precious metal flagged following the United States persidential elections.

Grayscale survey connects COVID-19 pandemic to new Bitcoin purchases

As Bitcoin price rises toward $18,000 and traders attempt to secure a new all-time high, the surge of institutional investors jumping on the Bitcoin (BTC) bandwagon continues.

According to research from Grayscale Investments, a digital asset management company that currently holds over $9.8 billion in assets under management, the coronavirus pandemic may be a primary driver of Bitcoin’s current rally. 

According to the company’s yearly survey, 83% of all Bitcoin investors started in the last 12 months, a time when COVID-19 infections were minimal.

38% of all current Bitcoin investors interviewed joined in the last four months, and among these, 63% say that the economic disruption caused by COVID-19 positively influenced their decision to purchase BTC.

Traditional markets

S&P 500 Record High. Stocks followed an uneven path to mostly positive returns for the week, although the S&P 500’s overall gain paled in comparison with the prior week’s 7% surge. The index finished the latest week at a record high—up more than 2% after posting strong gains on Monday and Friday but a steep decline on Thursday. 

COVID Factor. The coronavirus pandemic continued to be a big force driving financial markets, with a spike in new cases in the United States and many other countries offset by optimism about vaccine development. On Monday, the release of positive test data for one vaccine candidate was a key catalyst in a rally that sent the Dow 3% higher.

Oil Recovery. The price of U.S. crude oil jumped about 7%, moving back above $40 per barrel. The price was up about 16% from a recent low on November 1. However, the price weakened on Friday amid concern that the recent spike in coronavirus cases could trigger further travel restrictions, depressing demand for fuel.

Lagarde hints at more stimulus. President Christine Lagarde signaled that the central bank would expand its pandemic emergency purchase program (PEPP), which has bought more than EUR 640 billion of bonds, and its targeted longer-term refinancing operations (TLTROs), which have lent almost EUR 1.5 trillion to banks at accommodating rates, by year-end.

UK economic growth slows.  The UK economy grew by a slower-than-expected 1.1% in September, month-over-month data showed. Gross domestic product (GDP) rebounded 15.5% in the third quarter—a quarterly record—but failed to fully offset the almost 20% slump that occurred between April and June.

China Antitrust against Internet Giants.  Chinese equity investors received unwelcome news after the government released a draft of antitrust guidelines aimed at curbing the power of the country’s leading internet-based platforms. The proposed antitrust laws from the State Administration for Market Regulation were the second recent setback for China’s top internet companies after financial regulators abruptly pulled the initial public offering of fintech company Ant Group on November 3.

Philip Tam

Co-founder & CEO

Sources/Reference

OSL, coindesk, CoinMarketCap, Coincodex, Cointelegraph

John Hancock Investment, Bloomberg

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