Bitcoin May Top Soon — Analysts
According to data from the cryptocurrency exchange Bitstamp, the Bitcoin price printed $49,938 this morning — a new record high for the world’s largest cryptocurrency. From the technical perspective, the BTC buyers are likely to target a zone of $50,000 to $51,000 to collect their profits.
“Bitcoin volatility is likely to continue rising in the near term and remain elevated until it settles in around its next plateau,” said Mike McGlone, a commodity strategist at Bloomberg Intelligence.
McGlone is one of the strategists who believe BTC buyers are likely to target a move to $100,000 in the long-term. Bitcoin price has received a major boost after the EV giant Tesla announced it purchased $1.5 billion in Bitcoin and will look to start accepting cryptocurrency as a payment method soon.
Similarly, the payment-processing business Mastercard last week announced plans to provide business support for certain cryptocurrencies on their platform later this year.
“The cryptocurrency market continues to mature, and Mastercard is driving it forward, creating safe and secure experiences for consumers and businesses in today’s digital economy,” said Raj Dhamodharan, executive VP at Digital Asset and Blockchain Products and Partnerships, at the company.
However, some market analysts warn that the current rally in the cryptocurrency market and equities is unsustainable.
“It’s important to remember that Bitcoin never moves up in a straight line,” Antoni Trenchev, managing partner and co-founder of Nexo in London, told Bloomberg.
“Short-term volatility is very much a feature of this bull market and investors should prepare accordingly.”
Similarly, Wilmington Trust’s Meghan Shue sees a troubling trend in financial markets as investors continue to drive valuations higher. The BTC price is up almost 400% since October last year.
“It’s a little bit of chasing returns in the wrong areas. It’s also a little bit of chasing what’s already happened. One thing we have to be careful of is not to extrapolate what we’ve seen over the recent three months into the future,” she told CNBC.
Global equities are also trading at record highs with the benchmark US index S&P 500 printing a new all-time high on Friday, with the futures market suggesting even higher levels will be seen on Tuesday.
Bitcoin price moved to print a fresh record high near $50,000 as cryptocurrency investors continue to push valuations higher.
About the Author
Luigi Wewege is the Senior Vice President, and Head of Private Banking at Caye International Bank. Outside of the bank, he serves as an Instructor at the FinTech School which provides online training courses on the latest technological and innovation developments within the financial services industry. Luigi is also the published author of: The Digital Banking Revolution.