BITCOIN PRICE GROWTH IN MAY 2016 ANALYSIS

Updated: 06/09/2016 14:47
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Read the complete analysis of the bitcoin price growth in May compared to the previous growth, expert comments, expectations for June
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Read the complete analysis of the bitcoin price growth in May compared to the previous growth, expert comments, expectations for June

After in May the price per bitcoin grew by nearly 20% hitting the $500 level for the first time since the year 2014, it is safe to say the cryptocurrency is back to the center of attraction as the investment tool.

Bitcoin Price chart May 2016

Nevertheless, the most significant was the fact the profit happened to be on the background of powerful sentiment index. The data say profit concurs with high long-term and short-term index and other numbers, creating the "bull behavior" before entering summer months.

Because of the serious mass media interest it might seem the price growth in May was stunning. However, as the Bitcoin Price Index (BPI) numbers say it was just the fourth in size monthly growth to the US dollar for the current year.

A short while ago in February 2016 bitcoin experienced one more significant runup with the growth of 18.92%.

In May the run-up was a bit lower in numbers compared to the one on February when the price grew from $367.14 to $436.61, growing by 18.92%. Growth in May is not a circumstance of the monthly growth in November 2015 when the price grew by 20.64% from $312.43 to $376.91.

All-in-all during May the cryptocurrency grew by 18.35% opening at the level of $449.33 and closing at $531.80.

Price at the start of the month

Bitcoin price start of the month

Price at the end of the month

Bitcoin price end of the month

Difference

Bitcoin price difference

Maybe the most significant was the concentration of the price movement itself. The digital currency grasped the entire volume of the monthly growth within last five trade sessions during the period from May 27 to May 31.

Market behavior

Anyway, how strong was the bull behavior of bitcoin traders in May?

According to the data provided by Whaleclub bitcoin community long positions always exceeded the short ones. The monthly data extract made by Whaleclub shows the index of the lowest positions on long-term and short-term positions made 52%. Besides, the mood indicator shows the ratio according to which the size of positions on the certain day were higher than an average number, which made about 44% during the monthly period.

Bitcoin trades in May

Bitcoin trades in May 2016

Additional data from Whaleclub show the way bull market performed during the last five sessions in May, when prices went up by nearly 20%. Long and short positions achieved 89% nearly in every session of the period from May 31, reaching the level of 80%.

Volatility

Volatility index during the major part of the month were average enough with significant changes at the end of May. Largely, the 30-days volatility gave on 1.28% compared to May 1, and then during the month time on May 31 it grew to 2.44%. It reached the highest point of the month on May 28 at 2.46%.

It needs to be mentioned both daily, 30-days and monthly volatility were higher in May than in April, though they still couldn't meet the figures of January 2016. On January 24 the 30-days volatility escalation index reached the mark of 4.84%. While this number was nearly twice higher than 2.44% on May 31 and six times higher than the numbers achieved on April 17 - 0.73%.  

June expectations

Experts' expectations concerning the price development fully conformed to the bull market behavior. Chris Burniske, blockchain analyst and ARK Invest manager anticipated the future Bitcoin price growth, stressing upon at the end of May the daily volatility index was much lower than the index on January 24.

While Burniske emphasized liquidity as the key variable when providing comments, Adam White, Vice President of Business Development & Strategy at Coinbase stressed upon this factor in the recently published report.

Another factor, which could potentially help in promoting Bitcoin, is the people finding new and innovating ways of using blockchain registers, which contain digital currency transactions.

Jack Liu, Chief Strategy Officer at OKPAY expressed his opinion in this question, stressing the fact markets will look more attractive in case of getting the attention back to bitcoin and other cases of using own blockchain.

In any case all attention will switch to to bitcoin community to observe how effectively it is using blockchain applications compared to the progress, what steps are taken to solve problems and how it will react to the reward decrease which is going to take place in July.


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