'Bitcoin is closer to $100k than zero': Bitcoin price breaches $50k as more bullish signs emerge - analysts
"Bitcoin is closer to $100,000 than it is to zero. Recapturing the $50,000 level is a big deal for Bitcoin and significant for the cryptoverse. Bitcoin is starting to show bullish signs despite whatever risk mode is happening on Wall Street," said OANDA senior market analyst Edward Moya.
At the time of writing, bitcoin was trading at $50,018.78, up 5.44% on the day.
It is an important shift that bitcoin is breaking away from the bearish U.S. stock market sentiment. "It appears large parts of both the retail and institutional world have evolved and have embraced becoming Long-Term-Holders(LTH)," Moya noted on Tuesday.
This week, trading could be choppy, but a key price level to watch will be the $52,000 mark, which could trigger more technical buying, Moya added.
"Bitcoin volatility is always elevated on the passing of key psychological levels and that should remain the case this week. If Bitcoin rallies above the $52,000 level, that could trigger another wave of technical buying. Bitcoin could trade a handful of times through the $50,000 over the next couple of days," he said.
From a technical perspective, bitcoin is a well-rested discounted bull market that will continue to outperform, according to Bloomberg Intelligence senior commodity strategist Mike McGlone.
"The benchmark crypto is running into layers of support below $40,000. A correction of about 50% from its peak appears to have simply cleansed the market of excess and speculation," McGlone said on Tuesday. "The necessity of a rising stock market for reflation vs. the price-discovery stage of Bitcoin sets up well for continued outperformance for the crypto."
Despite China issuing a complete ban on crypto transactions, the overall global institutional and retail interest in bitcoin is not waning.
Digital assets are "too large to ignore," said BofA strategists, including Alkesh Shah and Jessica Reif Ehrlich. "Our view is that there could be more opportunity than skeptics expect."
The next big volatile driver for crypto is regulation, which could be a price-positive in the long term, according to analysts.
Moya is also projecting that the next major bull rally will be triggered by an eventual approval of a bitcoin ETF.
"The upcoming regulatory guidelines could prove to be disruptive over the short-term, but many cryptocurrency traders are gladly buying now in anticipation that we've seen the majority of the selling pressures. A Bitcoin ETF might take a little longer to get done, but it seems like it will certainly happen. That is expected to pave the way for the next boom," he said.
In the meantime, the headlines drama around bitcoin is not subsiding. JPMorgan CEO Jamie Dimon told Axios that bitcoin has "no intrinsic value" and that "regulators are going to regulate the hell out of it."
Citadel Securities founder Ken Griffin told the Economic Club of Chicago that the company does not trade crypto because of the space's regulatory uncertainty.
"I just don't want to take on the regulatory risk in this regulatory void that some of my contemporaries are willing to take on," Griffin said. "I actually think that doing so will make it a smaller market because it will become a far more competitive market when there is regulatory clarity and that will be good."
Griffin also questioned the amount of time and energy being devoted to cryptocurrencies. "Let's face it, it's a jihadist call that we don't believe in the dollar," he said.