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Bitcoin can be a good long-term investment


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Last year was quite successful for Bitcoin. The BTC/USD exchange rate has increased more than twice during this period. The digital currency has hit a historic high of 1.000 USD.

I want to list a few facts why the cryptocurrency will be in high demand in the nearest future and why it can be a good long term investment.

- The demand from China. There was a significant drop in China's stock market in mid-December, 2016. This happened due to the restrictions on investing in securities for insurance companies. The yuan faced a significant devaluation. These events have caused a sharp rise of the BTC/USD exchange rate.


- Increasing of the confidence in Bitcoin. Hacking attempts and emergency stops of the Bitcoin exchange don’t lead to panic as it was a few years ago. Confidence level to the digital currency has strongly increased.

- Instability. The ambiguous political and economic situation in the world have forced investors to seek alternatives for saving their money.


- Availability. More and more companies are trying to make Bitcoin more affordable for an average user nowadays. There was a significant breakout in the cryptocurrency development over the past few years. We believe that Bitcoin user base will grow exponentially, causing a rise in demand for Bitcoin.

The main value of Bitcoin lies in the fact that their emission is limited to 21 million. The factors listed above will help to popularize the digital currency among ordinary users. This can cause a really high demand for the cryptocurrency that will increase its value.



Current trading idea for BTC/USD

Support levels: 985.000, 880.000
Resistance levels: 1085.000

bbtc

Previously, we recommended to buyBTC/USD at 890.000. It has reached the 1035.000 level at the moment. The indicators point to the "bullish" sentiments development. The price is above the 50 MA and 200 MA. The MACD histogram has fixed in the positive zone and continues to rise.


I think that the BTC/USD exchange rate will continue to grow in the near future. I recommend to buy BTC/USD if the price consolidates above 1050.000. The nearest resistance level is 1085.000.



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About the author


Igor Afa is a financial analyst at JustForex.

 

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