(Bloomberg) -- Bitcoin diehards are breathing a sigh of relief as April winds down.
The world’s biggest cryptocurrency has jumped 36 percent, the biggest monthly gain since December, when it soared to almost $20,000 before quickly crashing to as low as $5,922 in January. The rally is leaving advocates optimistic.
"The repair process has slowly begun,” said Rich Ross, Evercore ISI’s head of technical analysis in New York. “It’s fairly fragile.”
Bitcoin is largely driven by psychology, said Ross, and its ability to break out of its four-month downtrend and reclaim the 50-day moving average are going to be part of the repair process.
“Of course when you have a 65 percent, 66 percent decline like that, but you’re still technically in an uptrend, that is going to attract some interest," said Ross. "The story hasn’t changed, only the price has."
The cryptocurrency market has benefited from the end of tax-related selling and the fading of regulatory-related headlines, while Wall Street is signaling increased interest in the asset class.
"The true test of this post-tax date rally will be a sustained move back above $10,000," said John Spallanzani, a portfolio manager at Miller Value Partners in Baltimore. "That is the key level for bulls to retake."
©2018 Bloomberg L.P.
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