Are MARA, CLSK, BITF, and RIOT stocks good buys ahead of halving?

Bitcoin mining stocks are having a great week as the coin’s price has gone parabolic. Marathon Digital (MARA) shares jumped by more than 20% on Monday and is slowly nearing its highest point in December. It has soared by over 310% from its lowest level in October last year.

CleanSpark (CLSK) stock crossed the psychological point at $20 and hit its highest level since November 2021. Bitfarms shares jumped to $3.60 while Riot Platforms rose to $17.8.

CKSK vs MARA vs RIOT vs BITF 

This rebound will likely continue on Tuesday now that Bitcoin price has jumped above the psychological point of $55,000. Its rebound happened after the coin formed what looked like a bullish flag or pennant pattern. In most cases, this pattern leads to more upside.

In this case, the rally means that there is a high possibility that Bitcoin will continue rising as buyers target the all-time high of $69,000. A break above that level could lead to more gains, with the next psychological level to watch being at $100k. In a recent note, Tom Lee, the founder of FundStrat predicted that Bitcoin would reach $150k soon.

The main reason for the rally is that Bitcoin ETFs are doing well, with the iShares Bitcoin Trust (IBIT) gaining over $6 billion in assets. The Fidelity Wise Origin Bitcoin Trust (FBTC) has added over $2.5 billion and some analysts believe that these funds will have more assets than gold in the coming years.

Further, Bitcoin is soaring as it always does ahead of a halving event. In this case, the halving will happen in April this year. The implication is that the number of Bitcoins that are produced daily will fall to about 450.

In this case, Bitcoin supply will be limited at a time when ETF investors are buying, leading to a demand and supply mismatch.

Therefore, all these events will have implications for Bitcoin mining companies like Marathon, CleanSpark, Bitfarms, and Riot Platforms. 

The only way that these firms will benefit is if Bitcoin continues rising and if they boost their mining activity. Most companies, especially the bigger ones like MARA and RIOT have been actively adding their mining capacity.

They have also continued to sell some of their coins in their balance sheet to take advantage of the soaring prices. 

Therefore, the short-term outlook for these stocks is bullish as the price of Bitcoin and other cryptocurrencies remains vibrant. This rally will likely continue ahead of the halving event. 

There is a possibility that these stocks will then pull back, albeit briefly, after the halving happens. In most cases, Bitcoin tends to pull back after the halving event. Most recently, we saw the price of Litecoin soar to $115 before its halving in 2023. It remains 35% below its highest point then.

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