Popular Demand Spurs Goldman Sachs to Start Covering Bitcoin

Popular Demand Spurs Goldman Sachs to Start Covering Bitcoin

After numerous client requests, Goldman Sachs has reportedly started covering bitcoin. The firm released a report on Monday with a bearish outlook for the digital currency.

Also read: Hedge Funds Are Quietly Investing in Bitcoin

‘Due to Popular Demand’

Popular Demand Spurs Goldman Sachs to Start Covering BitcoinBitcoin.com recently reported on hedge funds quietly investing in bitcoin. An article by Zero Hedge on Monday confirms that hedge funds are actively trading the digital currency. In addition, fund managers that are clients of Goldman Sachs have also petitioned the firm’s chief technician Sheba Jafari to start covering it.

Goldman Sachs subsequently released a client report called “GS Techs: Quick BTC” on Monday, according to the publication. “Due to popular demand, it’s worth taking a quick look at bitcoin here,” Jafari wrote, adding that the firm’s overall outlook is:

Wary of a near-term top ahead of 3,134. Consider re-establishing bullish exposure between 2,330 and no lower than 1,915.

Goldman Sachs’ Technical Analysis

Goldman Sachs’ report explains how it came up with the bearish outlook using technical analysis, Zero Hedge detailed. The firm claims bitcoin’s extended target price for a 3rd of V-waves, using the ratio of 2.618, is $3,134, which was almost reached on Monday. “Both daily/weekly oscillators are diverging negatively. All of this to say that the balance of signals are looking broadly heavy,” the report reads.

Following the third wave, the firm then explained its view on what’s to come:

An eventual 4th wave should retrace at least 23.6% of the length of wave III, which in this case comes to ~2,330. It shouldn’t go much further than 38.2% down at 1,915. Expect 4th waves to trade sideways/messy for a period of time before eventually continuing the underlying trend.

Popular Demand Spurs Goldman Sachs to Start Covering Bitcoin

Other More Bullish Predictions

Many people have recently offered their views on what they think the price of bitcoin will be. One of the most bullish in recent history is from Blockchain’s CEO Peter Smith, who is on the record for predicting:

A bitcoin might reach $500,000 by 2025.

Popular Demand Spurs Goldman Sachs to Start Covering BitcoinDaniel Masters, the chairman of XBT Provider, early this month told CNBC that he expects bitcoin to reach $4,000 by the end of the year. “Bitcoin is emerging as the transactional layer of the internet, as programmable money and as digital gold. That’s the big picture,” he said.

At the end of February, BTCC CEO Bobby Lee tweeted his specific prediction. “Bitcoin price target in 2020 after block halving: USD $5k-$11k, assuming $5-$10 million daily flow into #BTC by then,” he wrote.

“There is a lot of fresh liquidity flowing into bitcoin, thanks to a surge in interest among investors in Asia, notably Japan and Korea, coupled with a resolution to the scaling debate,” Aurelien Menant, the CEO of bitcoin exchange Gatecoin, said in May. “I would not be surprised to see the bitcoin price doubling again to around $6,000 by the end of the year.”

After hearing about hedge funds experimenting with bitcoin, RT TV host Max Keiser tweeted his prediction on Sunday:

Hedge funds are herd animals. If one starts pouring cash into bitcoin, others will follow; $5,000 within sight.

Do you think Goldman Sachs is too bearish on bitcoin? Let us know in the comments section below.

Images courtesy of Shutterstock, Goldman Sachs, NBC News, Zero Hedge

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  • sjs

    As the great squid wraps itself around Bitcoin to move it when and where it wants it to be with huge capital

  • Liberty88

    LOL…. asking Goldman Sachs to comment on the direction in the future of Bitcoin is like asking Toyota to comment on the direction and the future of its competitors such as Honda, Hyundai, Mitsubishi, Ford, GM…..

    I don’t go to my competition to find out what my future is – they don’t pay my bills…. I do.

  • Romm333

    The Blockstream developers in charge of Bitcon’s future are doing nothing but running Bitcoin into the ground. No innovation, no block size increase with demand, just a back log of transactions and high fees.

    I used to be a Bitcoin advocate and huge investor.

    Looking at Bitcoin from a business perspective, Bitcoin no longer offers anything of value. The management (Blockstream) has not developed Bitcoin to increase with demand, it has stalled it for 4 years straight. The news of the day for Bitcoin is no longer “What new Business joined Bitcoin”, it is now “What business has just left Bitcoin”.

    Blockstream is preventing Bitcoin from advancing so they can break the system via long backlogs of transactions by keeping the Bitcoin blocksize small, then they are going to try and swoop in with their patented “solution” to the problem they in fact created. It’s a joke and pathetic.

    Smart money and companies are leaving Bitcoin in droves and investing in Ethereum. The Ethereum Network Alliance has many Fortune 500 companies signing up. Ethereum’s creator is well respected and highly intelligent Vitalik Buterin. Ethereum can do many things that Bitcoin cannot.

    Bitcoin is about to turn into MySpace soon, sometime around August 1st when Blockstream pushes out changes that could potentially split the network in two.

    Bitcoin was once a technology about to disrupt the entire landscape, instead, Bitcoin is going to go down in history as a failed experiment while Ethereum takes the glory and changes the World.

    • sjs

      Sadly you are correct about the present state of affairs and you may well turn out to be right about the split as well. Note, Sheba Jafari has also been tasked with assessing ETH for investment purposes. The article has been lifted out of Zero Hedge.

    • HC

      What about Segwit, offchain scaling and the 2MB block size increase that comes with Segwit? It’s been out since last year! There has just been no adoption :/.

      • Romm333

        Segwit is a convoluted answer to a simple problem. No one wants it.

        Who was it developed by? Blockstream. What is Blockstream? Cancer.

        No one wants it. Yet, it’s being forced down the communities throats while Bitcoin is being held hostage.

        • HC

          Since I am just so uninformed, how is Segwit “convulted”? Do you have any idea what the underlying changes are in Segwit?

          Also, the developer doesn’t matter. I’ll tell you a story. Once, there was a developer who created one of the world’s fastest filesystems. He was heavilly praised, until they realized that the developer was in jail for killing his wife. Today the principles behind his filesystem are still used in computer systems all over the world. The filesystem itself, is still maintained by volunteers. The code he wrote, is probably running on your phone right now, this moment.

          As a programmer, this man is a genius. As a human, this man is “cancer”. But we ignored the cancer and took the genius. True story, search up ReiserFS to find out more.

          Also, your gonna have to explain why Blockstream is “cancer” to me, I might have missed that part.

  • Roister01

    How strange that Bitcoin was developed in part to curb the negative influence of banking and corporate entities…and now they are trying to influence the price with their own bias! A bit late to the party, they offer bearish advice, in order to mop up cheap bitcoin…they never change…?