The Wall Street market analyst predicts a huge upturn for the digital currency in the near future, owing to a number of reasons, including legalization of bitcoin in China and South Korea.
Sheba Jafari, the head of technical strategy at Goldman Sachs, expects that the virtual currency will soon increase above $3,600. The analyst says bitcoin price “may need another few swings” until it reaches new highs, Business Insider reports.
The cryptocurrency’s inability to surpass its June 13 level of $3,000, means it is forming a technical triangle pattern. Jafari suggested that the price will fall to as low as $1,786, along with five big swings. Bitcoin, she noted, is in the fourth wave right now.
“Anything above 3,000 (Jun. 13th high) will suggest potential to have already started wave V, which again has a minimum target at 2,988 and scope to reach 3,691 (the latter being a preferred target as this assumes a new high.),” Jafari wrote on Monday.
“Consider range-bound/corrective below 3,000. Shouldn’t retrace much further than 1,857-1,787. Eventually see potential for 3,691,” she wrote in the report.
Jafari’s previous predictions turned out to be quite accurate. Earlier this month, she forecasted that the bitcoin price would not drop below $1,857. The digital currency then plunged to around $1,852. A few weeks ago, Jafari suggested that bitcoin will significantly decrease after reaching $3,000 mark.
It is currently traded at $2498.74, according to data from CoinMarketCap. In general, bitcoin price surged by more than 165% in 2017.
In the beginning of July, Jafari suggested that the digital currency will rise to about $4,000 by the end of 2017. The prediction urged some investors to acquire bitcoin, thus driving the prices up. The main reasons for the growth of bitcoin, Jafari wrote, include the expected legalization of cryptocurrency in South Korea, elimination of consumption tax on bitcoin in Japan and Australia, as well as the soon legalization of bitcoin and ethereum in China.
However, it is difficult to predict the price, as there is a wide range of factors that can potentially affect the value. The upcoming bitcoin hard fork on August 1, 2017, has probably affected a 7% decline in the value of bitcoin and ethereum. While bitcoin lowered to below $2,500, ethereum fell to $200 per coin. Bitcoin and Ethereum, however, are not the only digital currencies in the list of top ten cryptocurrencies that faced a decline. Ripple has also lost almost 12% of its cost.
Last Thursday, 80% of developers supported a BIP91 proposal to double the maximum number of transactions on the bitcoin network without changing the 1MB limit.