One such Bitcoin bull is Nigel Green of financial advisory firm deVere Group.He predicts the virtual currency will soar to $12,000 by the close of the year, provided it can avoid the ‘Death Cross’ this week.
In technical terms, this is “ a bearish pattern that takes place when the 50-day moving average falls below the 200-day moving average .” In layman’s terms, this key level is around the $8,500 marker, a point at which the crypto asset has previously enjoyed strong support, Green says.
China chips in So why exactly is the deVere chief exec so positive, you may ask? Well, in a word, China.Late last week, president Xi claimed the country should “ seize the opportunity ” to adopt blockchain and lauded the next-gen technology as “ an important breakthrough for independent innovation of core technologies .”
According to Green: “ This is a clear signal that the leader of the world’s second-largest economy is moving towards embracing the technology — in which Bitcoin plays a vital part — and therefore taken as a positive boost for the whole digital currencies sector .
“ It also comes as China is said to be developing its own national digital currency, which is further proof that in some form or another, digital currency is the future ,” he adds.
Bitcoin clearly has the bit between its teeth and there are other factors, like fears over the slowing global economy and political issues, such as Brexit and the US-Chinese trade war, which could boost buying in the weeks and months to come, Green predicts.
He suggests that FOMO — or the ‘Fear of Missing Out’ — could also continue to drive investor demand.
Better buys I don’t want to be a party pooper, but I’m afraid these latest price rises do little to raise my enthusiasm for crypto assets.In fact, the wild volatility of recent days illustrates exactly why I consider Bitcoin and similar currencies to be unsuitable investment destinations, and particularly so as a wide range of questions over the legitimacy of this asset class remain unanswered.
Why take a gamble with your money on an asset where prices will likely continue to swing lower and lower? I’d much rather plough my hard-earned capital into FTSE 100 dividend stocks, investments which have proven to be much more stable, and over a longer period of time too.
While the geopolitical and macroeconomic environment could indeed boost safe-haven demand for Bitcoin now and during 2020, I’d much rather buy classic defensive stocks such as defence giant BAE Systems , healthcare specialist GlaxoSmithKline , telecoms titan Vodafone , or power network operator National Grid .
Right now, share pickers can grab a mighty, inflation-bashing average yield of 4.8%, and I reckon this makes the blue-chips (broadly speaking) brilliant buys today.
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The Motley Fool UK owns shares of and has recommended GlaxoSmithKline.Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro.Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
Motley Fool UK 2019.
