Google Trends Data Suggests Bitcoin’s Price Recovery Was Fueled by Institutional Money

Francisco Memoria

Data from Google Trends appears to suggest that bitcoin’s rally so far this year has been fueled by institutional investors entering the market, and not by retail investors buying the flagship cryptocurrency to then sell higher.

The search engine’s data comes in an index that ranges from 0 to 100, and indicates search interest for the term “bitcoin.” While an exact number of searches isn’t known, it’s clear from Google’s data that interest for BTC dropped significantly when compared to 2017,

When the flagship cryptocurrency hit its all-time high near $20,000 in December of 2017, the index for bitcoin was at 100, and dropped throughout last year’s bear market to a low of five before it started to recover in December of 2018. Currently, it’s at 12.

Google Trends' data on the word bitcoin

Notably, CryptoCompare data shows that in December of last year the cryptocurrency hit a low of $3,200. Since then, it’s been recovering and in a six-month period its price tripled as BTC is now trading at $10,500. This, after briefly cruising past the $11,000 mark.

It’s believed many retail investors lost interest during last year’s bear market, as those who put their money in when BTC was close to its all-time high are still in the red. The rally in 2017 was likely partly caused by fear of missing out (FOMO) as BTC’s price rose in a short amount of time and investors wanted to make sure they didn’t miss out on potential gains.

This year’s rally is believed to have been led by institutions. As CryptoGlobe covered, a report published by blockchain analysis firm Diar showed that in less than nine months bitcoin whales accumulated 450,000 BTC. In February of this year, it was also reported whales were acquiring large amounts since the start of 2019.

Crossing the $10,000 psychological resistance is significant. Tyler Winklevoss, one of the co-founders of the Gemini cryptocurrency exchange, has noted that after surpassing it he believes bitcoin will soon hit $15,000.

Tom Lee, managing partner at independent research boutique Fundstrat Global Advisors, noted during a talk at the CryptoCompare Digital Asset Summit that “full blown” FOMO was set to start after bitcoin breached the $10,000 mark, and noted it could go to $40,000 within five months.

Time to Be ‘Cautious or Short' Bitcoin, Says Bollinger Bands Creator

Francisco Memoria

John Bollinger, creator of the popular technical analysis tool Bollinger Bands, has tweeted out it’s time to be “cautious or short” on the price of bitcoin, after the cryptocurrency’s price dipped below $10,000 for the third time since the so-called black Thursday.

On social media, Bollinger pointed out that bitcoin’s last move p over the $10,000 mark, which came shortly after U.S. President Donald Trump finished a speech on law and order in which he vowed to take “immediate presidential action to stop the violence” and said he was “mobilizing all available federal resources — civilian and military — to stop the rioting and looting,” was a head-fake.

A head-fake, Investopedia writes, occurs when the price of a security moves in one direction initially, but then reverses its course and moves in the opposite direction. These trades occur most frequently at key breakout points – for bitcoin, a key point was the $10,000 mark.

The price of the cryptocurrency dropped suddenly after breaking its key breakout level earlier this month over a flash crash on BitMEX that saw its price dip to $8,600 before it started recovering. CryptoCompare data shows that bitcoin is now trading above $9,600, but that since the March 12 coronavirus-induced market crash it has tested the $10,000 mark three times already.

Bollinger, it’s worth noting, has a decent track record looking at cryptocurrencies. In October 2019 the analyst accurately said the price of BTC dropping to $7,300 was a head-fake, and the price of the cryptocurrency then moved up in a significant rally to $9,500.

In April of this year, Bollinger tweeted out BTC was “moving into squeeze territory,” shortly before the cryptocurrency’s price started surging. He was, however, caught off guard by the Black Thursday sell-off, as were most investors and analysts.

It’s worth noting many in the cryptocurrency space are still bullish long-term. As reported early BTC developer Adam Back – who some believe could be Bitcoin creator Satoshi Nakamoto – has said he believes the price of the cryptocurrency will hit $300,000.

Featured image via Unsplash.