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What goes up must come down? Bitcoin investors may be asking this question as the cryptocurrency fell sharply on Monday.
The price of bitcoin BTCUSD,
was the latest drop of 13% to $ 35,600, according to prices quoted by CoinDesk. Losses were also seen on Sunday, when bitcoin rose from nearly $ 41,000 to just over $ 35,000, briefly rebounding before resuming its descent.
The action follows an enthusiastic buy last week that pushed bitcoin near an all-time high of $ 42,000. Despite further sales, the cryptocurrency is still up 22% so far for 2021, easily beating a 1.8% gain for the S&P 500 SPX,
1.6% for the Dow Jones Industrial Average DJIA,
and 2.4% for the Nasdaq Composite COMP,
Other cryptocurrencies also had an equally bullish start to the year, with Ethereum Ether ETHUSD,
up to 50% and Litecoin LTCUSD,
earn 15%. But those assets have also seen declines of 16% and 20%, respectively, over the past 24 hours.
Institutional investors have helped spur the recent rally, and digital currency fans are confident bicoin gains may be more durable than the 2017 surge, which saw prices climb from around $ 1,000 to $ 17,000. to reverse those gains by the end of 2018.
Bitcoin enthusiasts believe the asset may hold its value better this time around, after the central bank’s massive printing of money in 2020 aimed at helping economies recover from the deadly coronavirus pandemic.
The 24-hour selling period is nothing more than an expected “healthy correction”, Naeem Aslam, chief market analyst at AvaTrade, told clients in a note Monday.
“Bitcoin prices are expected to find their support between $ 28,000 and $ 30,000. Now is not the time to panic, but to look at this opportunity from a more optimistic point of view, as the bull run is not over yet and it is still likely to make its way upwards ”, did he declare.
In its report “The Flow Show” released last week, Bank of America raised the question of whether the evolution of bitcoin prices represented the “mother of all bubbles.”
JPMorgan strategists, meanwhile, recently made the case for the digital currency’s value at $ 146,000 if it can continue to drive investors away from GC00 gold,
as a refuge type asset.
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