Last updated on October 12th, 2017 at 11:59 pm
It is safe to say that the aftermath of the Silk Road auction is no longer having any impact on the Bitcoin price, whether it be negative or positive. Ever since my last price analysis, the Bitcoin price has been experiencing sideways action. Staying between $610 and the high $630s, it appears that the price will likely not go below $600 as long as the markets stay free of negative news, further confirming my hunch that the Silk Road auction helped establish a new short term trend in the low $600s. From this point on, I believe the Bitcoin price will remain fairly steady, with individuals on the markets holding their investments in anticipation of good news.
Lack of Major News Means Flat Bitcoin Price Activity.
Ever since the ruckus in the Bitcoin community over the Silk Road auction has died down, the news has been relatively quiet as far as Bitcoin is concerned. No major, non-Bitcoin related companies have announced an intent to accept the digital currency as a viable means of payment. There has also been no further reports from governments or nongovernmental agencies regarding whether or not Bitcoin should be accepted or banned. All in all, the past 2 or so weeks has been very calm in the Bitcoin community.
Of course, the community of positivist Bitcoin price analysts are constantly coming up with wild predictions about future price trajectories. One individual in particular, on the bitcoinmarkets subreddit, has recently pointed out small bumps in the price that precede major Bitcoin “bubbles” and pointed at a small bump that was ongoing at the time—9 days ago. Judging solely based on this rather insignificant bumps in the Bitcoin price, this person speculated that we could see a huge increase in prices in the coming weeks. Highly unlikely, unless some major news hits the community that fuels a buying spree. That type of chart watching and shape-comparing is precisely what comes from adhering to a positivist methodology when trying to analyze the Bitcoin price. Only by treating changes in the price as a consequence of human action will we be able to identify the cause of those changes and construct an accurate portrait of what the future Bitcoin price will look like. Analysts should be watching price charts and then then the news in order to understand where the price will go, rather than looking at price charts and then comparing it to the charts from last year.
The much more likely trajectory of the Bitcoin price will resemble the gradual increases that have been going on since early May. Therefore, the price charts going into late 2014 will look like a gradual incline rather than rocket to the moon. A bullish forecast nonetheless, but slightly disappointing to us hardcore Bitcoin enthusiasts. However, we must not rule out the possibility of some kind of major news making its way into the community. In such an event, the Bitcoin price would most definitely skyrocket, although whether or not the heights achieved in that price jump would persist is uncertain. For instance, the Silk Road auction caused a substantial increase in the Bitcoin price, but as the excitement died down the price began to drop and settled down at its current level.
That being said, it seems as if the Bitcoin price will stay within the $600-$640 range as long as this lull in significant news persists. I say this because the trading volume has been decreasing steadily ever since the beginning of July. This decrease signifies an increase in the amount of bitcoins being held, which explains the sideways action we’ve been seeing since the end of the Silk Road auction. Since people are holding off on both buying and selling, it seems likely that the market is anticipating some big news, positive or negative. They are refraining from doing any significant amount of trading for fear of losing out either by selling right before a wave of good news or from buying before a wave of negative news.
What might that news be? We hope that it will be positive news of course, and a recent Coin Brief interview with Josh Garza, the CEO of GAW Miners hinted at some very, very good news on the horizon. The CEO mentioned that the company has been working on something huge, the details of which remain private. Project Prime, according to Josh Garza, will revolutionize the way people look at crypto-currency. So when this project goes public, hopefully we will see huge gains in the Bitcoin price.
“As for where GAW is going in the future, all I can will say is keep your eyes on the lookout for Project Prime. My lips are sealed other than saying that it’s going to revolutionize the way people think about cryptocurrencies.”