Source: Yahoo Finance
On Feb 8, the BTC/USD bulls surged ahead to make history and reaching a record high. Looking at the chart above, the price moved sharply upwards at nearly 90° from $39,220.08 to $42,581.36, before continuing its upwards journey. At the time of writing, the price is at $46,373.69.
The main reason behind the bulls' power to reach historic heights is news that Tesla has bought $1.5 billion worth of Bitcoin. It has also announced that it will soon begin accepting bitcoin as a mode of payment. CoinDesk reported that after the Tesla announcement, large cryptocurrency exchanges such as Coinbase and Kraken encountered technical difficulties due to a surge in trading activity. CoinDesk also highlights other institutional investors such as Paul Tudor Jones II and Bill Miller who have invested in Bitcoin, as a potential hedge against inflation. Will Apple be next?
It is now estimated that Bitcoin has a market valuation of $818 billion, only $5 billion short of Tesla’s $823 billion. It has overtaken Facebook, which has a market valuation of $757 billion. Stefan George, the co-founder, and chief technology officer of prediction-market platform Gnosis believe that this heralds a new age where the cryptocurrency ecosystem will be integrated into the mainstream business.
The important question now is: what lies ahead for the flagship cryptocurrency? While only time can give a definite answer to that, for now, let’s take a look at some BTC/USD’s technical levels. Bullish trends are clearly evidenced, as demonstrated by the fact the BTC/USD is trading above its 50-day Moving Average (indicated by the purple line). The Moving Average Convergence Divergence (MACD) also points towards a bullish reversal.
Not surprisingly, the Relative Strength Index stands at 65, not far from an overbought condition, which reflects a strong FOMO (fear of missing out sentiment) in the market. Trading volumes are also showing strong upwards spike. The increasing sense of FOMO could make BTC/USD resilient against any major market movers for now. The FX Street team believes that should there be any pullback, a key support level lies at $41, 987, which a previous record achieved in January. Meanwhile, on the upside, a key resistance level is at $50,000.
With this new milestone for the digital gold, it appears that confidence in the traditional markets as we know it is clearly waning. As President Biden attempts to push through his proposed $1.9 trillion stimulus package to salvage the economy, one must bear in mind that the U.S. is already close to $27 trillion in debt. This situation is akin to a game of Jenga, and if one piece falls from a carefully arranged stack, how much damage will it cause?
With this in mind, it appears that traders are already searching for a brand-new world, and at this moment of time, Bitcoin is the king of this new world. Let's watch how high can Bitcoin reach.
BTC/USD (as of Feb 9, 2021, 9.55 a.m., GMT +8) - $46,373.69.
FOLLOWME BTC/USD User Sentiment (as of Feb 9, 2021 at 10.25 a.m.)
Short – 76.41%
Long – 23.59%
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