Last Obstacle: Bitcoin Price Near its ‘Loftiest Point’ Since January 2018
While the stock market continues to feel the heat of the elections, the bitcoin market is enjoying a red-hot rally. Analyst Mati Greenspan in his daily newsletter Qutamm Economics wrote,
“This sort of bullish action at a time when stocks are showing increased volatility only adds to the narrative that bitcoin can be seen as a safe haven to hedge increasingly larger portfolios.”
With the latest upwards move, the digital currency was on its way to break the 2019 high of $13,900, just millimeters away from its “loftiest point” since January 2018, before tumbling about 4% to just under $13k.
Last night, bitcoin's price went nearly to $14,000, a level the market loudly believes is the only resistance to the $20,000 all-time high. Greenspan said,
“Note that between the levels of $14,000 and $20,000, there is insufficient price data to single out any specific points of resistance. Yes, there's still a possibility of a large retracement. $14,000 is a large point of resistance, and we're still watching that upward channel.”
NGL I’m more bullish about 2021 today at $13k than I was a few months ago at $9k.
– Institutional FOMO
– Resilient against negative news
– Sentiment is still primarily “disbelief”
$14k. Then $20k. There’s literally nothing in between.
— Qiao Wang (@QwQiao) October 27, 2020
Seen as the “last boss” before hitting the peak, it’s not to say there won't be any hiccups along the way, which quant trader Qiao Wang believes “will be buying opportunities for those don’t own enough yet.”
Today, BTC price retraced under $13,000, up about 90% YTD while managing the ‘real’ trading volume of over $ 3 billion. In October, the leading digital currency had increased by almost 30% in value.
With this latest retracement, already BTCs are happening with NFL athlete Russell Okung jumping right on that.
It’s only right. pic.twitter.com/S2mVDswu8U
— russ (@RussellOkung) October 28, 2020
Supply-side liquidity crisis to blow it up
In the past few days, the news of PayPal allowing its customers access to cryptocurrencies, Singapore’s biggest bank DBS soft launching its fiat-to-crypto exchange, and JPMorgan’s JPM Coin making its first payment since announcing its development in 2019 is leading to increased interest from institutions. As Nic Carter of Coin Metrics told Bloomberg,
“This rally seems to be more driven by allocators with larger balances getting involved, rather than a flurry of retail investors.”
“It seems that there is more excitement and that crypto will be used more often,” said Edward Moya, a senior market analyst at Oanda Corp. “The world seems poised for a digital currency.”
In the short-term with the US Presidential election next week, volatility is expected. Things are expected to get “very noisy” not only because of high odds of a contested election but with Europe in the process of lockdown as well.
Still, it won't take BTC long to burst through $14,000, as it is known for its explosive moves. Sven Henrich, the founder of NorthmanTrader, is also targeting $17,000 per coin. Jake Chervinksy, General Counsel at Compound Finance, noted,
“Bloomberg analysts think BTC might hit $14,000 by . . . the end of the year? That long? Try next week. After all this time, legacy finance types still have no sense of BTC's face-melting volatility. The coming “supply-side liquidity crisis” will blow them all away.”