Bitcoin is not overbought and could reach $75,000 before the current bull market ends, research from Kraken says

GettyImages 1169764411
Citi said bitcoin is at a “tipping point.”

  • Bitcoin is not yet in “overbought” territory and could reach $75,000 before the current bull cycle ends, Kraken says. 
  • According to historical price movements of bitcoin, the first quarter of 2021 could be met with massive gains for the token. 
  • Bitcoin is up 62% year-to-date as of Friday as it hovers just below $48,000.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Bitcoin could gain much higher before the current bull market ends based on historical price movements, says a Kraken Intelligence market report published Friday.

Although bitcoin is quickly approaching resistance, it remains several tens of thousands of dollars away from entering into “overbought” territory, Kraken said. If bitcoin were to surpass $75,000 in the next few months, historical price action suggests bitcoin would then be close to the top of the cycle. 

The cryptocurrency has pulled back from its all-time high above $58,000 on February 21, but it still finished the month 37% higher. The coin is up 62% year-to-date as of Friday as it hovers just below $48,000.

According to Kraken, bitcoin is now trending in a manner most similar to the first quarter of 2013, bitcoin’s best first quarter on record. If the trend continues, the first quarter of 2021 “could be a historic quarter with a relatively outsized return.”

“By plotting a logarithmic growth curve that connects BTC’s prior market cycle tops (resistance) and bottoms (support) and by making assumptions about how severe BTC will correct upon hitting a cycle high, one will find that BTC likely has plenty of upside before entering a bear market,” the report says. 

The report comes as some investors voice concerns that bitcoin’s rapid acceleration is a clear sign the cryptocurrency is in a bubble waiting to burst. Michael Burry said the coin is a “speculative bubble that poses more risk than opportunity” in a tweet Monday that has now been deleted. 

On Wednesday Kraken CEO Jesse Powell told Bloomberg a $1 million as a price target within the next 10 years is “very reasonable.” 

 

Screen Shot 2021 03 05 at 8.32.34 AM
Read the original article on Business Insider

US stocks mixed as investors hit pause on Monday’s rally

Traders work on the floor of the New York Stock Exchange (NYSE) on November 20, 2019 in New York City
Traders work on the floor of the New York Stock Exchange (NYSE) on November 20, 2019 in New York City


US stocks were mixed on Tuesday after a rally on Monday that saw the S&P 500 post its strongest daily gain since June, as the full reopening of the US economy seemed within reach. 

US daily coronavirus cases are falling and on track to be below 40,000 this week after a slight surge last week, according to Fundstrat data. This positive news, along with falling volatility and rising bond prices, likely led Monday’s rally that investors are hoping to continue on Tuesday.

Here’s where US indexes stood after the 9:30 a.m. ET open on Tuesday:

US and European markets are racing ahead of their real economies, potentially creating bubbles that could pop, China’s banking regulator has warned.  Guo Shuqing, chair of the China Banking and Insurance Regulatory Commission, said US and European markets are racing ahead of their real economies, potentially creating bubbles that could pop. 

Zoom jumped 9% after the video platform beat earnings estimates and forecasted strong growth. The company’s revenue forecast for the coming year was above Wall Street expectations.

Bitcoin traded above $48,000 after briefly climbing back above $50,000 for the first time in six days. 

Oil prices were higher. West Texas Intermediate crude jumped as much as 0.54%, to $61 per barrel. Brent crude, oil’s international benchmark, rose by 0.44%, to $63.96 per barrel.

Gold jumped 0.16%%, to $1,726.20 per ounce. 

Read the original article on Business Insider

Tech stocks tumble as investors balk at lofty valuations

Traders work on the floor of the New York Stock Exchange (NYSE) on November 20, 2019 in New York City
Traders work on the floor of the New York Stock Exchange (NYSE) on November 20, 2019 in New York City


US stocks were mixed on Monday with tech stocks pulling back over valuation concerns while investors weighed what rising yields could mean for inflation.

Fundstrat’s Thomas Lee says the case for cyclical stocks within energy, industrials, consumer discretionary, materials, and financials is strengthening as coronavirus cases fall and the US economy begins to re-open.

US lawmakers will debate on President Joe Biden’s proposed $1.9 trillion American Rescue Plan act this week. Also, Federal Reserve chairman Jerome Powell will deliver testimony to the Senate Banking and House Financial Services Committees

Here’s where US indexes stood at the 4 p.m. ET close on Monday:

Shares of Churchill Capital IV spiked as much as 19% on Monday after a Bloomberg report said a merger with the electric-vehicle maker Lucid Motors could come as soon as Tuesday. The report follows weeks of rumors that special-purpose acquisition company Churchill would merge with Lucid. 

Famed Reddit trader Keith Gill has increased his stake in GameStop, according to a screenshot he posted to Reddit on Friday. Gill, who goes by Roaring Kitty on YouTube and Twitter and DeepF—ingValue on Reddit, now owns 100,000 shares of the video-game retailer, representing a double of his previous common share stake of 50,000 shares. 

General Electric gained as much as 5.6% on Monday but Goldman Sachs predicts the stock could jump roughly 20% to $15 per share. Analysts from the firm sat down with GE executives on Friday to discuss the company’s operations and financials. The analysts came away “encouraged” by free cash flow and power business momentum at the company.

Bitcoin tumbled as much as 17% on Monday after hitting a record above $58,000 over the weekend, though Bitfinex CTO Paolo Ardoino says daily price movements are “more of a sideshow.”

“Today’s price movement may galvanize bitcoin’s many critics, including those who recently dismissed the leading cryptocurrency as an economic sideshow. Such criticism misses the point and the profound impact it is starting to have. For many of the battle-tested exchanges that have weathered the market fluctuations, volatility isn’t new and is to be expected in such a young market. For many in the industry, development and deployment is priority,” Ardoino said on Monday.

Oil prices spiked. West Texas Intermediate crude rose as much as 4.14%, to $61.69 per barrel. Brent crude, oil’s international benchmark, jumped 3.7%, to $65.24 per barrel.

Gold rose 1.75% to $1,808.60 per ounce, at intraday highs.

Read the original article on Business Insider

Americans are becoming increasingly bullish on cryptocurrency as bitcoin soars to new records

Bitcoin.
Bitcoin miners are seeing gold despite the cryptocurrency’s recent fall.

  •  A new study of 30,000 Americans reveals 50% view cryptocurrencies as safe investments.
  • The survey also revealed 57% of investors think companies should accept crypto as payment.
  • Though crypto enthusiasts have mixed opinions on whether bitcoin will ultimately serve as a medium of exchange or simply a store of value.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Bitcoin’s record-breaking rally to a $1 trillion market capitalization on Friday has increased the buzz around cryptocurrencies. Debates on whether these are worthy investments have flourished among investors, analysts, and the public. 

Despite critics arguing against the legitimacy of these assets, a new study reveals that cryptocurrencies are viewed as safe investments by 50% of Americans. Additionally, 41% of those surveyed said investing in the stock market and cryptocurrencies are equally risky investments. 

Conducted by Piplsay, a global consumer research platform, the study surveyed over 30,000 people in February on their views on digital currencies.

“The crypto bull run has seized the attention of millions of people who previously had never considered digital currencies like Bitcoin to be an alternative asset,” said Pavel Matveev, CEO of Wirex, a digital payments platform. “Bitcoin and other currencies are intended to have several uses, not least ease of exchange, purchase, and liquidity.” 

The survey also revealed that 57% of Americans think major companies should start accepting cryptocurrencies as payments. In a separate survey of 1,050 Americans conducted by DealAid, 50% of investors said they would be willing to pay for products using bitcoin. 

Some companies this year have already taken steps towards accepting cryptocurrency as a means of payment. PayPal in October 2020 said it will start allowing people to use cryptocurrencies starting this year, while Tesla announced in January it plans to start accepting bitcoin as payment. Investment banks JP Morgan and Morgan Stanley have both also expressed interest in considering cryptocurrency as payment.

Critics however are quick to argue that the volatility of cryptocurrencies makes them poor medium of exchange.

“If you bought a $50,000 Tesla with four bitcoins on October 1st, that purchase now has an opportunity cost of $212,000, because bitcoin’s dollar price has risen from $10,000 to $53,000 in those four and a half months,” said Robert Minter, Director of Investment Strategy, Aberdeen Standard Investments. “That type of volatility is unsuitable for transacting in an economy.” 

Bitcoin has skyrocketed in recent days, surging 60% this month alone. Ethereum, the second-largest cryptocurrency by market value, also soared to record highs Thursday. Even dogecoin, a cryptocurrency that began as a joke, has been gaining traction in recent weeks

“Bitcoin’s market cap hitting $1 trillion demonstrates the mainstreaming of cryptocurrency as a store of value,” said Adam Liposky, Ecosystem Operations Lead at Pocket Network, a blockchain data ecosystem for Web3 applications. “We expect that Bitcoin is only the first of many $1TR market caps that we’ll see in the blockchain economy.”

Enthusiasts argue bitcoin may exist solely as a form of value akin to “digital gold,” while other forms of digital currencies will emerge as forms of payment. 

Mike Venuto told Insider he doubts “we will ever buy coffee with bitcoin.” 

“This excitement obscures the reality of the original bitcoin thesis of decentralization, replacing the trusted third party and banking the unbanked,” Venuto, who manages an approximately $1 billion ETF, said. “The focus now seems to be the store of value argument from the limited supply.”

Read the original article on Business Insider

Bitcoin above $51,000 is unsustainable unless volatility subsides, says JPMorgan

Bitcoin 1
  • Bitcoin’s current price above $51,000 is “unsustainable” unless volatility subsides, JPMorgan said in a note. 
  • Strategists estimate a large portion of recent flows into the token have been driven by speculation. 
  • If the token’s volatility converges to that of gold, bitcoin could reach $146,000, they added.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Bitcoin’s current price is “unsustainable” unless the cryptocurrency’s volatility dies down, according to JPMorgan.

The cryptocurrency flew to new heights above $52,800 on Friday morning, bringing its year-to-date gains to more than 80% as the breakneck rally powers ahead. Just one year ago, bitcoin traded around $10,000.

The cryptocurrency has achieved the fastest-ever price appreciation of any “must-have asset” to which it is often compared, like Gold in the 1970’s and internet stocks in the 1990’s, noted JPMorgan. But the rally has left wary investors reminded of the mania in 2017 that ended in a steep drop. 

Strategists led by Nikolaos Panigirtzoglou wrote in Tuesday note that unless bitcoin’s price swings subside “quickly from here,” the current rally could end in disappointment. 

The strategists estimate that $11 billion of institutional money has flown into bitcoin since the end of September, but they say  a large portion of that has been dominated by “speculative investors seeking to front run other more real-money institutional investors.”

Despite the firm’s short-term caution, JPMorgan sees bitcoin’s price growing significantly higher in the long run.

If bitcoin’s volatility converges to that of gold, JPMorgan has a “theoretical price target” of $146,000. However the strategists said this convergence would be a “multi-year process” and would also depend on bitcoin ownership tilting more institutional and less retail over the coming years.

“For the bitcoin market cap to match the total private sector investment in gold via ETFs or bars and coins, we estimate that mechanically bitcoin prices would need to rise to $146k,” JPMorgan added. 

Read the original article on Business Insider

Canada approves first bitcoin ETF, raising hopes that the US SEC will soon follow

Bitcoin
Bitcoin.


Canada’s financial regulator approved the first publicly traded bitcoin ETF in North America, according to records published Thursday.

The Purpose Bitcoin ETF will seek to replicate the performance of the price of bitcoin, minus the ETF’s fees and expenses, according to a fact sheet posted by Canada-based asset manager Purpose Investments. It will trade on the Toronto stock exchange under the ticket “BTCC.” 

“The Fund has been created to buy and hold substantially all of its assets in long-term holdings of Bitcoin and seeks to provide holders of ETF Units (“Unitholders”) with the opportunity for long-term capital appreciation,” the company prospectus reads.

Cidel Trust Company will be the custodian of the ETF while Tyler and Cameron Winklevoss’ Gemini Trust Company will be the sub-custodian. Ernst and Young will be the auditor of the ETF.

The ETF announcement raises hopes that the US Securities and Exchange commission could be one step closer to approving a US bitcoin ETF. Several firms have filed and failed to gain approval for a bitcoin ETF in the past, with the SEC typically citing security concerns.

“It’s another step towards an ETF being authorized in the US,” Sui Chung, CEO of CF Benchmarks told Insider.

While the Canadian bitcoin ETF is a  “significant”  move forward that demonstrates how regulators in North America have gotten more familiar with the crypto landscape, it’s unclear how quickly the US will follow suit, especially given the differences between Canadian and US financial regulations, Chung added.

Despite pushback from the SEC, demand for bitcoin-based investments has soared during bitcoin’s 2021 rally. The Grayscale Bitcoin Trust that follows bitcoin has gained 272% in the last twelve months. It’s similar to an ETF but it’s physically backed by bitcoin.

Read more: One of Wall Street’s most popular self-defense strategies failed during the coronavirus meltdown. Ex-Bridgewater advisor Damien Bisserier was among the few who made it work, and he told us how he did it.

Read the original article on Business Insider

Dow, S&P 500 hit record highs as Biden administration continues push for $1.9 trillion stimulus

happy trader
  • All three major US stock indexes climbed to intraday record highs Monday as investors remained optimistic for a large stimulus.
  • Treasury Secretary Janet Yellen pushed for Congress to pass a package of $1.9 trillion, citing the rocky labor market.
  • Bitcoin soared to a record high after Tesla said it bought $1.5 billion of the cryptocurrency.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

All three major US stock indexes hit intraday record highs on Monday as investors remained hopeful the Biden administration will pass a large stimulus package to support the economic recovery. 

US Treasury Secretary Janet Yellen pushed for Congress to pass a $1.9 trillion stimulus package in a Sunday interview. “If we don’t provide additional support, the unemployment rate is going to stay elevated for years to come,” she told CNN. Her comments follow last week’s disappointing payrolls report; The US added 49,000 jobs in January, missing the estimate of 105,000 additions.

“Reasons for the surge include the end of the short-interest induced frenzy, a gradual slowdown in the number of new Covid-19 cases in the U.S., an improvement in global GDP growth estimates, and the likelihood that most of the Biden $1.9 trillion stimulus package will be approved by congress,” said CFRA’s Sam Stovall on Monday.

The S&P 500 and Nasdaq closed at records last week to finish the first five trading days of February.

Here’s where US indexes as of 12:45 p.m. ET on Monday:

Read more: Credit Suisse says to buy these 16 ‘highest-conviction’ stock picks that are set to outperform despite the market’s contrarian view

Bitcoin soared as much as 16% to all-time-highs of $44,795.20 Monday morning after documents filed with the SEC revealed that Tesla invested $1.5 billion in the popular cryptocurrency. The electric vehicle maker also said it plans to accept the cryptocurrency as payment.

The latest investor dipping into the SPAC space is US hedge fund Elliott Management, known for its activist leaning. The Wall Street Journal reported Elliott has been meeting with bankers to raise more than $1 billion to create a special-purpose acquisition company.

Dating app Bumble increased its IPO size to $1.8 billion on Monday, according to a regulatory filing. The company will now offer 45 million shares priced at between $37 to $39 per share.

Oil prices rose. West Texas Intermediate crude jumped as much as 1.44%, to $57.66 per barrel. Brent crude, oil’s international benchmark, gained 1.37%, to $60.16 per barrel, at intraday highs.

Gold rose 1.2%, to $1,834.50 per ounce.

Read more: GOLDMAN SACHS: Buy these 13 stocks poised to benefit from surging commodity costs – including 2 set to soar by more than 40%

Read the original article on Business Insider

Dow, Nasdaq on pace for record highs as Biden administration pushes for $1.9 trillion stimulus

happy trader
  • US stocks are set to hit new record highs Monday as investors remain optimistic for a large stimulus.
  • Treasury secretary Yellen pushed for Congress to pass a package of $1.9 trillion, citing the rocky labor market.
  • Bitcoin soared to a record high after Tesla said it bought $1.5 billion of the cryptocurrency.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

US stocks neared record-highs Monday morning as investors remain hopeful the Biden administration will pass a large stimulus package to support the economic recovery. 

US Treasury secretary Janet Yellen pushed for Congress to pass a $1.9 trillion stimulus package in a Sunday interview. “If we don’t provide additional support, the unemployment rate is going to stay elevated for years to come,” she told CNN. Her comments follow last week’s disappointing payrolls report; The US added 49,000 jobs in January, missing the estimate of 105,000 additions.

The S&P 500 and Nasdaq closed at records last week to finish the first five trading days of February.

“Reasons for the surge include the end of the short-interest induced frenzy, a gradual slowdown in the number of new Covid-19 cases in the U.S., an improvement in global GDP growth estimates, and the likelihood that most of the Biden $1.9 trillion stimulus package will be approved by congress,” said CFRA’s Sam Stovall on Monday.

Bitcoin soared 13% to all-time-highs of $43,725.51 Monday morning after documents filed with the SEC revealed that Tesla invested $1.5 billion in the popular cryptocurrency. The electric vehicle maker also said it plans to accept the cryptocurrency as payment. Bitcoin’s previous record high was $41,946.74 on January 8.

Here’s where US indexes stood after the 9:30 a.m. ET open on Monday:

Read more: Bank of America says investors might start selling stocks and buying bonds sooner than expected. Here’s when it could happen, and what to own for maximum income if yields keep rising.

The latest investor dipping into the SPAC space is US hedge fund Elliott Management, known for its activist leaning. The Wall Street Journal reported Elliott has been meeting with bankers to raise more than $1 billion to create a special-purpose acquisition company.

Dating app Bumble increased its IPO size to $1.8 billion on Monday, according to a regulatory filing. The company will now offer 45 million shares priced at between $37 to $39 per share.

Oil prices rose. West Texas Intermediate crude jumped as much as 1.44%, to $57.66 per barrel. Brent crude, oil’s international benchmark, gained 1.37%, to $60.16 per barrel, at intraday highs.

Gold rose 1.2%, to $1,834.50 per ounce.

Read more: GOLDMAN SACHS: Buy these 13 stocks poised to benefit from surging commodity costs – including 2 set to soar by more than 40%

 

Read the original article on Business Insider

Bitcoin has now replaced tech stocks as the most crowded trade, according to a BofA fund manager survey

Bitcoin
Bitcoin.


A Bank of America fund manager survey reveals that a significant number of investors believe bitcoin is the most crowded investment trade. 

In a January survey of portfolio managers, strategists, and chief investment officers who together manage over $561 billion, 36% of investors surveyed said bitcoin is the most crowded trade. “Long tech” had previously held that title since October 2019. 

The survey emphasizes the extreme bullishness around the cryptocurrency as it soars past new records and attracts new investors from the retail and institutional sides of the market. 

The last time bitcoin was deemed the most crowded trade was in December 2017, when it peaked at $20,000 but spiraled downward in the following year. 

Read more: We spoke to crypto platform Gemini, which is backed by the Winklevoss twins, about Bitcoin, how to use stable coins and why regulation won’t kill the boom in digital currencies

“Long tech” came in second place, with 31% of investors considering it the most crowded trade. Meanwhile 23% said short the US dollar was the most crowded, and 4% said long corporate bonds. 

The survey comes as the cryptocurrency sheds off some of its gains from the beginning of 2021. Bitcoin sank as low as $33,412.72 on Wednesday, after climbing to a record of nearly $42,000 earlier this month. On Tuesday, Biden’s pick for Treasury Secretary Janet Yellen suggested that lawmakers “curtail” the use of cryptocurrencies such as bitcoin over concerns that they are “mainly” used for illegal activities.

Read the original article on Business Insider

Dow drops 200 points as traders mull Biden’s stimulus plan and soft retail-sales data

trader upset
  • US stocks sank on Friday as investors digested President-elect Joe Biden’s stimulus plan and a December slump in retail sales.
  • Biden rolled out a $1.9 trillion relief proposal on Thursday that includes $1,400 direct payments, state and local government aid, and expanded unemployment benefits.
  • While Democrats’ soft Senate majority increases the odds of a deal being passed, Republican opposition could strip the bill of some elements or push for higher taxes to offset its cost.
  • Retail sales shrank 0.7% in December as COVID-19 lockdowns cut into holiday-season spending, according to Census Bureau data published Friday. Economists expected sales to hold flat from November.
  • Watch major indexes update live here.

US equities fell on Friday amid a drop in retail sales and concerns that President-elect Joe Biden’s stimulus proposal could lift taxes.

Biden unveiled a $1.9 trillion fiscal relief plan on Thursday that includes $1,400 direct payments, expanded federal unemployment benefits, and state and local government aid. Democrats’ victories in Georgia runoff elections greatly improve the party’s chances at passing such a sweeping stimulus measure.

Yet GOP opposition could strip the bill of some components before its passage. Lawmakers could also call for higher taxes to justify the legislation’s hefty price tag, a move that would surely rankle investors hoping for President Donald Trump’s low tax rates to remain in place.

Here’s where US indexes stood shortly after the 9:30 a.m. ET open on Friday:

Read more: Global X’s lithium and battery ETF returned 126% in 2020 as electric vehicle-driven demand surged. One of the firm’s analysts shared 4 stocks he sees ‘leading the rise’ in the industry going forward.

“The very health of our nation is at stake,” Biden said in a speech revealing the plan, adding that failure to pass a large-scale relief package “will cost us dearly.”

Stocks extended losses after retail sales data showed a third-straight monthly decline to close out last year. Spending at US retailers contracted 0.7% in December as COVID-19 restrictions offset holiday-season sales, according to Census Bureau data published Friday. Economists surveyed by Bloomberg expected sales to stay flat from the month prior.

November’s reading was revised lower to a 1.4% contraction, suggesting surging coronavirus cases and lockdown measures swiftly cut into a V-shaped rebound in consumer spending.

“This likely is the nadir for retail sales, as the late-December stimulus and the pending stimulus under the Biden administration will boost both bank accounts and consumers’ spirits,” Robert Frick, corporate economist at Navy Federal Credit Union, said.

Read more: ‘I don’t believe that we’ve really left the recession yet’: Bond king Jeff Gundlach lays out the 2 risks that investors should watch nearly a year into the pandemic – and shares the 4 components of a balanced, winning portfolio

Fourth-quarter earnings kicked off with JPMorgan beating revenue and profit expectations. The bank reported a 42% jump in net income, bolstered by the release of $2.9 billion in loan-loss reserves.

Citigroup reported less-than-stellar results Friday morning. While the bank’s revenue landed above estimates, weaker-than-expected performance in its fixed-income division contributed to a miss on quarterly earnings. The business reported revenue of $3.09 billion over the period, below the consensus expectation of $3.2 billion.

Bitcoin dropped below $38,000 as the cryptocurrency’s volatile trading week came to a close. The token climbed back above $40,000 on Thursday but failed to retake the record highs seen one week ago.

Spot gold slid 0.5%, to $1,836.64 per ounce, at intraday lows. The US dollar strengthened against the majority of Group-of-10 currency peers and Treasury yields declined. 

Oil prices sank as the stronger dollar cut into its recent climb. West Texas Intermediate crude fell as much as 1.7%, to $52.68 per barrel. Brent crude, oil’s international benchmark, dropped 1.9%, to $55.37 per barrel, at intraday lows.

Now read more markets coverage from Markets Insider and Business Insider:

Cathie Wood’s ARK Invest runs 5 active ETFs that more than doubled in 2020. She and her analysts share their 2021 outlooks on the economy, bitcoin, and Tesla.

Monetary stimulus will remain in place well into economic recovery, Fed Chair Powell says

US consumer comfort tumbles to lowest point since July as COVID-19 surge cuts further into recovery optimism

Read the original article on Business Insider