- Investors exercise caution as Bitcoin flirts with $20k all-time-high.
- Technical indicators suggest Bitcoin’s overbought streak is due to come to and.
- The Dow recorded its biggest ever closing number.
There’s something about the phrase ‘all-time-high’ that seems to evoke feelings of awe and fear in equal measure.
Here at Market Watch, we’ve watched over the last few months as Bitcoin has tip-toed toward the mythical $20,000 mark. While there seems to be some confusion over what the actual all-time number is, there’s broad agreement that $20k is the mark everyone has in mind.
Yesterday, Bitcoin was steaming towards the big 2-0, but has since pulled back as investors seem to be asking themselves if they should keep buying or wait to see how the market pans out. They’re right to be cautious. If we cast our minds back to that hallowed day on December 18 2017, no sooner had Bitcoin broken through $20k it began a pullback almost immediately.
By December 21, it had dropped $4,000 as investors felt $20k was as good as they were gonna get and high-tailed it out of the markets with profits still in tack leaving those who bought at the top of the market with nothing but losses.
So it’s understandable there’s unease, and looking at the technicals, there may be something in this superstition. The Relative Strength Index – a measure of whether an asset is overbought or oversold – has shown that Bitcoin has been overbought for 36 days straight. How long will it go on for? Who knows. What investors fear is that a harsh correction seems likely as the run has been so sustained.
Others are looking to Bitcoin’s previous pattern of rises then pullbacks that happen in cycles.
Investor Peter Brandt says there are more corrections to come based on historical cycles, others feel this will be the fifth correction before a push above $20k to around $21k. But like my mother always used to say, charts don’t predict prices, prices dictate charts.
Global market cap continues to rise
While that’s all been going on, crypto global market cap is still sitting healthily above $500 billion, thanks to performances from XRP, Stellar and NEM. As we wrote yesterday, Ripple’s cryptocurrency has exploded in value after a combination of regulatory clarity and states looking to get into the digital currency market. That trend continued today with a 12% gain in the last 24 hours.
Stellar holders meanwhile are enjoying the warm glow that comes when your holdings grow by 40% in one day, thanks to the successful upgrade of the Stellar network. The good news has doubled XLM’s price over the last 48 hours and put it top of the leadership of coins with the biggest weekly gains.
Dow Jones reaches historic milestone
While investors tread carefully in crypto, investors in the Dow Jones Industrial Average are trampling over each other to pour money into the market.
The reason comes as the Dow crossed the 30,000 mark for the first time…