BITCOIN and top alt-coins ethereum and Ripple could soon rally as buyer signals indicate the cryptocurrencies are building power for another bullish run, former analyst Tomas Salles said.
The finance expert studied bitcoin, ethereum and Ripple and found that a bullish mid-term event could be in store as the cryptocurrencies continue to attract buyers.
Writing for FXStreet, Mr Salles said: “Investors might be a bit out of place with the shy rises being registered during this week, after being used to big ranges in the Crypto sphere.
“There is no reason to be concerned. This is an opportunity to see less explosive developments, but much more sustainable.
“With the Cryptos in consolidation mode, a less volatile behaviour might be a very important factor for a more solid bull market.”
Bitcoin price stood at £7,419.56 at 19:15 (BST) on Friday, according to CoinDesk. It saw its highest value before Christmas when it reached the monumental price of just under $20,000.
Mr Salles said there is a “bullish lateral action with buyers increasing their positions is the most likely scenario” for bitcoin.
Focussing on a BTC/USD price chart, he added: “The Directional Movement Index is matching the exact bullish pattern.
“Buyers are still moving above the ADX while sellers diminish their strength and are trading below the trend strength indicator. There is room for bullish developments.”
For ethereum, Mr Salles said the profile is “weaker” than in bitcoin’s case but the Directional Movement Index is similar between the two cryptocurrencies, despite ethereum showing “less advanced” development.
The finance expert also said Ripple is trading “very close” to a clean scenario that might allow a “gradually bullish development”.
Cryptocurrencies have faced criticism by banks and finance experts, with billionaire Bill Gates telling CNBC he would bet against the bitcoin and short it if he could.
The Microsoft co-founder said: “As an asset class, you’re not producing anything and so you shouldn’t expect it to go up. It’s kind of a pure ‘greater fool theory’ type of investment.”
He added: “I agree I would short it if there was an easy way to do it.”
Former PayPal CEO Bill Harris also claimed bitcoin is the “greatest scam in history”.
The founding PayPal CEO believes there is “no store value” in bitcoin, it should “not be accepted as a means of payment” and has no intrinsic value.