“Sell in May and go away” is advice usually applied to the equity market, but some cryptocurrency market observers believe “sell in May” does not apply to bitcoin. Bitcoin, the largest digital currency by market capitalization, surged 35% in April.
At this writing Friday, the digital currency was up 1.37%, trading over $9,216 with a market value of $164.70 billion.
“However, historical data suggests that bitcoin is more likely to build upon its April rally this month,” reports CoinDesk.com. “Notably, the world’s largest cryptocurrency by market capitalization has scored gains in the month of May in five out of the last seven years, according to CoinDesk’s Bitcoin Price Index.”
Related: After 35% April Surge, Bitcoin Trading Narrows
Despite bitcoin’s rally Tuesday to start the month of May, some market observers are concerned that declines for the cryptocurrency could reinvigorate bearish traders, particularly if bitcoin posts several closes below the $8,800 area.
May Upside for Bitcoin
Since 2011, Bitcoin has notched only two negative performances; in 2013 and 2015. In May 2017, bitcoin prices surged 73%.
“Furthermore, BTC has fared well in every second quarter since its creation – the highest being 1,964 percent in Q2 2011, when bitcoin jumped from $0.78 to $16.10,” according to CoinDesk.
Recently, the Bitcoin Dominance Index has been rising, confirming the dominant perch of the cryptocurrency. After bitcoin, the largest cryptocurrencies are Ethereum, Ripple, Bitcoin Cash and Litecoin.
There is significant room for growth in the cryptocurrency universe. Recent data suggest a small amount of American investors own any digital currencies and, after bitcoin, the numbers of crypto ownership dwindle.
Some bitcoin bulls believe the cryptocurrency can return to $20,000 or even move to $25,000 as soon as later this year.
“BTC tends to perform well in May, thus an upside breakout of the narrowing price range is more likely and could yield a quick move higher to $10,000,” according to CoinDesk. “On the other hand, a downside break would open the doors to $8,490 (38.2 percent Fibonacci retracement of the rally from $6,425 to $9,767.4).”
For more information on the cryptocurrency market, visit our Bitcoin category.