Bitcoin

Two reasons CNBC’s Brian Kelly sees Bitcoin is capped at $ 19,000

The dealer of Quick money Brian Kelly of CNBC sees it Three possible signs of a peak price when Bitcoin (BTC) hit $ 19,000. Both basic and technical factors suggest this A pushback could be imminent while the rally goes too far.

According to Coinmarketcap, Bitcoin’s market capitalization is currently $ 357,376,938,401.

1-hour chart for the BTC / USDT pair (Binance). Source: TradingView.com

Kelly gave three reasons why a Bitcoin price decline could occur in the short term. L.The reasons were the pumping of altcoins, the overvaluation due to the growing number of addresses and the high financing rates. November 25th said on CNBC:

“I’m still a bitcoin bull. In the long term, I’ll be a bull for the next decade. But when I think of a long-term investor rather than a short-term hedge fund investor, there are some things there that I see as a sign of a ceiling see. “

Pumping altcoins changes things

Two reasons CNBC’s Brian Kelly sees Bitcoin is capped at $ 19,000
Two reasons CNBC’s Brian Kelly sees Bitcoin is capped at $ 19,000

As Cointelegraph reported, Alternative cryptocurrencies or altcoins such as XRP and Stellar (XLM) have risen sharply in recent months. The uptrends are reminiscent of the altcoin craze in January 2018, when the price of bitcoin fell and altcoins rebounded.

During the last market peak, the price of Bitcoin corrected sharply while Altcoins rallied, and then the entire market collapsed in the months that followed.

Considering that major altcoins have increased between 50% and 100% in the past few weeks, Kelly is cautious about the rise of the altcoin market. Said:

“More than any other asset class in the world, the price of Bitcoin is primarily subject to the FOMO. We see speculative currencies, currencies below $ 5, rising 30% to 40% a day. Something like this happens when short and medium term Upper limits are formed. “

The rally in altcoins has caused major problems in the cryptocurrency market. For example, the price of XRP soared nearly 50% on November 24th and hit over $ 0.90 on Coinbase. Demand rose to the point where Coinbase temporarily fell, which coincided with a drop in Bitcoin and Ether (ETH) prices.

Surcharge for the growth in the number of addresses

Kelly has been using the Bitcoin address growth metric continuously since 2017 to evaluate the price of Bitcoin. If the growth of addresses does not match the price of Bitcoin, it may mean that BTC is overvalued.

Kelly recently said the market is pricing in 25% address growth for Bitcoin over the next month. According to Kelly, this is a worrying sign of that could mean that the Bitcoin market is overvalued in the short term. Said:

“If I look at the growth in the number of addresses, the market is expecting a 25% growth in the number of addresses in the next 30 days. Any time such address growth is implied, it is a sign of caution.

The futures funding rates are high

Eventually, Kelly noticed the surge in funding rates for bitcoin futures contracts on major exchanges.

When the funding rate rises, the market will be dominated by buyers and long-term contract holdersThis increases the likelihood of a long contraction or withdrawal. He showed:

“The last thing is that you notice retailers entering that market and you start to see that the interest rates they charge on the margin go up a lot faster.”

Arguments against a local maximum of $ 19,000

In the last two days, however The funding rate for Bitcoin futures stabilized after the Bitcoin price fell from $ 19,400 to $ 18,700.

But while the funding rate is still higher than usual, is at 0.03%. To compare, The funding rate remained at 0.18% on major exchanges at the height of recent spikes.

98% of $ BTC addresses make a profit, everyone is happy!

The market does not overheat as much Many addresses benefit comfortably. The combination of the two could allow the rally to resume in the short term.

Google Trends data shows this too The ongoing rally is of less general interest than it was three years ago, suggesting that the rally is only in its early stages. The popularity of the keyword “Bitcoin” in Google searches only had 20% interest at the end of 2017.

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