News Bitcoin Gets A Lift — For Now?

Bitcoin Gets A Lift — For Now?

-

- Advertisment -

A real lift or a dead cat bounce?

Bitcoin price seems to be recovering — up low single digit percentage points at this writing — to a bit more than $5,700, and then backing off a bit to a recent $5645.

The $5,700 level, if it had held, would have been a threshold not seen since November of last year.

Call it a matter of technical trading, noted Reuters via The New York Times.  On Wall Street, technical trading involves the recognition (or, we might say, the perceived recognition) of patterns that alert traders and speculators to levels of pricing support or levels of resistance that help determine where an asset’s price might be headed.

Technicals are sometimes (but not always) used in a way that may be divorced from fundamentals, which are tied to the underlying fortunes of a business that in turn underpin an asset price.  The Times noted there are “no immediate news catalysts” that are in place to send bitcoin higher.

Of course, there have been some hints of cryptocurrency uptake in recent days, and in recent hours, in fact.  Facebook, for example, has been reportedly meeting with companies (financial companies and merchants) to launch its own digital stablecoin. The social media giant has been said to be searching for $1 billion to back that endeavor, known as Project Libra, and backers may include Visa, Mastercard and First Data.

The funding would conceivably underpin the coins, giving them status as stablecoins, and would thus, possibly, sidestep some of the volatility that has been the hallmark of more familiar offerings like bitcoin, which is not backed by … well … anything except hope and perhaps no small dose of hype.

Taken on a case-by-case basis, one use case does not validate all use cases.  The fact remains that different business models have different rates of acceptance, and some fade away.  Should Facebook indeed come to market with its own stablecoin, that might not immediately validate bitcoin.  In fact, other cryptos may be embraced more fully than the marquee name, and bitcoin may be simply a speculative instrument, as it seems to be now — too high, cost wise, to be used fluidly in commerce (and relatively slow in terms of transaction times).  The fact that this week’s pricing action gets much notice, and that some observers point toward a psychological “barrier” of $6,000 that may be a support level, speaks more to trading than, well, trade (as in commerce).

Thus, the dead cat bounce — a temporary recovery before the downtrend takes another leg down — may be in the offing.  Bitcoin has many lives, like a cat, but one wonders how many times this cat can land on its feet.



Source

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest news

Spain approves Crypto Holdings disclosure bill from cryptocurrency holders

Spain approves Crypto Holdings disclosure bill from cryptocurrency holders. Spain's government has reportedly approved...

CryptoTaxCalculator Partners With CoinSpot

Australia’s leading cryptocurrency exchange CoinSpot has partnered with Australian made CryptoTaxCalculator to help users deal with the...

Will Cryptocurrency Survive in 2021?

The million dollar question: ''Will Cryptocurrency Survive in 2021''? Should you keep investing?

How to make money on COVID-19

It's no secret that many people lost their jobs and a lot of money as a result...
- Advertisement -

Is Bitcoin Still the Best Cryptocurrency?

Since Bitcoin’s meteoric rise in popularity, a lot has changed within the crypto market. While Bitcoin was...

7 Of The World’s Most Powerful Banks Are Preparing a New digital Currency

Systemic central banks' interest in cryptocurrencies is nothing new, however, the COVID19 pandemic and increasing mobility from...

Must read

Spain approves Crypto Holdings disclosure bill from cryptocurrency holders

Spain approves Crypto Holdings disclosure bill from...

CryptoTaxCalculator Partners With CoinSpot

Australia’s leading cryptocurrency exchange CoinSpot has partnered...
- Advertisement -

Read Next
Recommended to you