Bitcoin Monthly Outlook – December 2017

To say that November was a good month for the bitcoin bulls would be an understatement. The prices almost doubled during the month with the lows coming in at around the $5500 region and the highs coming in at around $11500 during this period. None of the bad news and adverse comments about bitcoin seemed to matter to the bitcoin bulls and speculators who were intent on pushing the prices higher and during the course of this period, they managed to achieve the coveted target of $10,000 which was a huge psychological mark which many of the investors and traders would have had in their mind some months back.

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Bitcoin Market Zooms Ahead

The fact that this price was achieved much before the end of the year and that the prices overshot this region to move beyond the $11,000 region during the month was a sample of how strong this bull run has been during the month of November. In fact, this was the month when the bitcoin market faced one of its biggest challenges as the hard fork that was scheduled to happen during the middle of November, was cancelled and this led to some correction in the industry as the uncertainty that this event led to, brought in some confusion among the traders. The fact that the developers could not agree on a proper approach has made the investor doubt on how the industry would react for future hard forks and this kept the prices under pressure for a few days.

This also led to the migration of a few miners and investors to other markets like bitcoin cash and ethereum and once again, it looked as though the bitcoin prices would crash a lot more. But this uncertainty and correction lasted only for a few days as the market shrugged off the same in a matter of days and resumed the uptrend in a strong manner. During the course of the month, there were many comments from various people, ranging from central bankers to hedge fund leaders, both in support of and against bitcoins but the impact of all these on the bitcoin market has been minimal.

But one factor that did help to boost the prices was the news that the CME and the CBOE are looking to launch futures trading in bitcoins. Of course, this requires the approval of the regulators, which is likely to be a big challenge, but this also throws open the doors for the launch of bitcoin futures in other major exchanges which is likely to help the bitcoin market to continue to mature in a quick manner.

Bitcoin Prices Likely to be Highly Volatile

Looking ahead to the month of December, though the rest of the market is likely to be affected by the drying up of liquidity towards the close of the year and this is likely to bring down volatility in those instruments, this lack of liquidity could divert the investors and funds towards the bitcoin market which could add to the bullish scenario and also lead to a lot of volatility in the bitcoin prices over the next month.

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With the prices having broken through the $11,000 region and with us already having seen a correction back to the region of resistance turned support, the way is clear for the bitcoin prices to continue on their way up in the coming month and the lack of volatility in the other markets could only help the bitcoin traders. With this background, we would not be surprised if the prices break through the $12,000 region and head towards the $15,00 region during the course of the month. Of course, we are seeing more and more regulators beginning to sit up and take notice of bitcoins as the prices grow and more and more traders are drawn into the market and so the traders have to be aware of the developments on the regulatory front as well as any major moves like banning of trading in a major country could affect the bitcoin prices and lead to some large scale correction within a matter of a few hours, something that we have seen many times over. Stick to regions of support and resistance and with the technicals being the guiding force in this market, which does not rely too much on fundamentals, it is important for the traders to take note.

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