Marathon Digital Holdings (MARA) Stock News and Forecast: Is it time to buy MARA?

Crypto stocks were where it was at on Monday with the usual names exploding higher. Bitcoin was on fire and heading for $60,000, showing continued strength after the rally last week. Fed Chair Powell had instigated the rally with comments that Bitcoin was not likely to be banned, and the move has created further momentum with FOMO (Fear Of Missing Out) traders entering the crypto leader and pushing it toward $60,000. FOMO is just a new word for momentum trading. Momentum had once been a dirty word in investing circles, but with the advent of behavioural economics it became more acceptable and mainstream. The key is to create that momentum, sustain it and ride the trend for as long as possible. 

MARA stock forecast  

Bitcoin versus MARA stock over the past month

Step 1 is achieved: show the strong correlation between the price of bitcoin and MARA stock. No argument there then!

Step 2: can this move continue? Looking at Bitcoin on the daily chart below, it is setting into some tough resistance around $60,000. The volume profile bars are increasing. $50,000 to $55,000 was light volume but now volume picks up from back in May. So the move may stall. If Bitcoin gets above $60,000, there is no volume resistance. Holding above $55,000 is key in our view.

Marathon Digital (MARA) stock is beholden to Bitcoin, but it does have the ability to move independently, especially when it takes steps to increase its mining capacity, etc. If the price of Bitcoin remains stable and MARA can mine more of it, then logic dictates that MARA should go higher, all else being equal and the costs of acquiring new mining rigs not becoming prohibitive. MARA stock has recently taken steps to do just that with the announcement of a $100 million credit facility with Silvergate Bank. We do not have details on the interest and repayment rates associated with this facility but must assume based on the price of Bitcoin remaining stable that increased mining capacity should add to MARA's bottom line and profits.

Technically, as we can see from the daily chart below, MARA staged a perfect bounce from the 200-day and 100-day moving average, as well as the yearly Volume Weighted Average Price (VWAP). All these combined at $30.55, the low from September. This remains strong support. 

FXStreet View: bullish, neutral below $37, bearish below $30.