The price of bitcoin may have hit a new all-time high above $6,140 today, but believe it or not it’s already showing signs it may be primed to push higher.
For the week, bitcoin is already up nearly 10 percent, while for the month, it is up over a jaw-dropping 55%.
Looking ahead, however, at least two underlying trends suggest it may trace higher in the days or weeks ahead.
TREND #1 : Google Search volume on the rise
On the back of the all-time high, Google search volume has notably shot up in the last 4 hours.
Long an indicator of potential buying (the internet-based asset is bought online mostly after all), this trend suggests the rally has attracted the attention of the investor community.
According to data from Google Trends, bitcoin search volume is near all-time highs.
The situation could easily devolve into a self-feeding cycle – i.e. more investors enter the market for its stellar returns, and end up pushing prices higher.
Volumes on exchanges so far show that they’ve risen to match. While writing this article, 24-hour volumes were up across all major exchanges, with British Virgin Islands-based Bitfinex showing the highest increase at just over 14 percent.
So, volumes on Bithumb (BTC/KRW) and bitFlyer (BTC/JPY), two other large regional exchanges, have jumped 7 percent and 6 percent, respectively.
Weekly chart – Charting the uncharted territory
As for price action analysis, there is little reason to worry except for the overbought technical indicators. Healthy pullbacks cannot be ruled out, however, the outlook would remain constructive as long as dip demand is strong.
Key levels that could act as resistance:
- $6,000 (psychological level) ..you know, a nice EVEN NUMBER BROKE IT!
- $6,196.81 (100% Fib extension of the move from July low-August high-September low)
- $7,073 (161.8% Fib extension of move from July low-August high-September low)
On the downside, moving averages (50-MA, 100-MA & 200-MA) could work as strong support levels.
With all the bitcoin hype, what does it mean for penny stocks?
Well first, we have seen this before when breaking the $4000 mark, and a softer push near $5000. Now at $6000 and demand still strong, many analysts may start predicting when $7000 or even $10,000 could be reached. So, to get back on point, we have seen what stocks do what as many reflect the price movement of bitcoin.
Next, beware of falling into the trap of companies starting their own cryptocurrency. I would not call them copy cats, but just because bitcoin is doing well, it doesn’t mean your “whatever coin” is going to follow suit. In the end, unless you have major backing and acceptance in the industry, new coins will be extremely difficult to catch on.
Last, be leery of all the penny stock news looking for attention with press stating they are now accepting bitcoin payments etc. In my opinion, that is wonderful, but at this moment in time, I bet less than 5% of whatever transactions they are doing will be purchased using a bitcoin wallet. Until the general public gets on board, these press releases are simply trying to piggy back off the bitcoin hype.
The SEC is also aware of this “crypto currency” madness and has been watching ICO’s and has halted a handful already in recent months. It is a great sector, but investors must use caution as with any other investments.
Here are some bitcoin penny stocks to watch:
$DIGAF $0.149 – Digatrade Financial Corp is a global Digital Asset Exchange Platform, blockchain development and advisory services company.
$BTCS $0.166 – BTCS Inc. is an early mover in the blockchain and digital currency ecosystems and the first “Pure Play” U.S. public company focused on blockchain technologies.
$BTSC $0.0667 – Bitcoin Services, Inc. The issuer’s business operations are each Internet based and are the mining of Bitcoin (a virtual currency) and Blockchain software development.
$GBTC $702.51 – Bitcoin Investment Trust is a private, open-ended trust that is invested exclusively in bitcoin and derives its value solely from the price of bitcoin.
$MGTI $2.29 – MGT Capital Investments, Inc. ranks as one of the largest U.S. based Bitcoin miners
$BLKCF $2.1753 – Global Blockchain Technologies Corp. is an investment company providing investors access to a basket of holdings within the blockchain space, managed by a team of industry pioneers and early adopters of all major cryptocurrencies.
$SANP $.0017 (up 1700% last 30 days) Santo Mining Corp. dba PODWERKS (the “Company”), (OTCBB:SANP) and Chongqing Yuhuan Technology Co., Ltd also known as Canoe Pool today announced they have entered into a Letter of Intent (the “LOI”) to merge and create Canoe Pool America. Under the terms of the LOI, upon execution of the definitive merger agreements, SANP shall issue to Canoe Pool 150 million shares of preferred stock of SANP, representing approximately 35% of SANP’s post-merger preferred stock, and 50 million additional shares of preferred stock upon achievement of certain Bitcoin Mining technology goals, representing approximately 40% of SANP preferred stock. Canoe Pool shall have the right to appoint up to three directors to the SANP Board of Directors, and will assist SANP Canoe Pool America in developing the American Bitcoin Mining Pool market and to accelerate the further development of the combined company’s Bitcoin Mining Pool pipeline. PODWERKS manufacturing expertise in modular container spaces coupled with a long history of doing business in China, sets the stage for both companies new mission to further develop the U.S. crypto currency mining market. The transaction is expected to be finalized in the next 30 to 45 days, and is subject to customary closing conditions.
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DISCLOSURE: PSInvestor is not long nor has been compensated by any of the above mentioned companies. Please read our disclaimer before investing in bitcoin or any companies mentioned on our website or social media accounts.