This week, Bitcoin price recovered nicely from the drop experienced last week that took us just under $47,000, but since then, it had taken to range between $53k and $56k.
This is turning out to be good for altcoins, with Ether (ETH) hitting new ATH every day now and the total cryptocurrency market cap at almost $2.2 trillion.
ETH 4.03%
Ethereum / USD
ETHUSD
$ 2,788.20
$112.36
4.03%
Volume 33.17 b
Change $112.36
Open $2,788.20
Circulating 115.67 m
Market Cap 322.51 b
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However, while the largest cryptocurrency has rebounded above its 100-day moving average, it is still trading below its 50-day moving average, which according to Bloomberg, means Bitcoin is nearing its inflection point.
Bitcoin’s 50-day mean currently sits at about $57,000.
If the crypto asset fails to overtake this level as it did on several occasions last week, it will be in for volatility.
“The drastic — relative to what we’ve seen of late — pullback certainly was a point of eyebrows being raised, but at the end of the day, I think the fact that things we’re able to rebound and stabilize is a good thing,” said David Tawil, president of ProChain Capital. “It shows real power to the token, the staying power to the asset class.”
Still the Best Macro Trade
On Wednesday, Bitcoin made its way upwards and went to nearly $56,500 but instantly dropped back, going to about $53,500.
Some speculated this was due to the rumor of Facebook having made an investment in Bitcoin not coming true. Also, the SEC delayed the decision on the Bitcoin exchange-traded fund (ETF) to mid-July.
Troy Gayeski, a co-chief investment officer of Skybridge Capital, recommends not to sweat this volatility around Bitcoin and that investors have to expect huge (20% to 30%) pullbacks. He said in an interview with Bloomberg,
“This bull market is still younger than the last two in terms of length. And we could see many rational reasons why there’s less upside this time around, and it’s a longer bull market, but it’s really hard to argue that it’s going to be a shorter bull market. There’s really no fact or basis for that in our opinion.”
Talking about the company’s portfolio allocation, Grayeski shared, “what we’ve seen is with the addition of bitcoin, our beta was already low. It’s gone down even further.”
He further said that in the liquid bitcoin market, one could evolve their position by trimming it, like Tesla did, while SkyBridge has decided to add to it further, even in pullbacks.
Not Many Choices Available
The good thing is macro-environment remains favorable to bitcoin with risk-on sentiments pushing the S&P 500 to a record high thanks to the Federal Reserve promising to keep the monetary policy loose with inflation above 2% and interest rate near zero. Chuck Cumello, president and CEO of Essex Financial Services said,
“No question about it — what drives a big chunk of the interest in Bitcoin has been just the tremendous amount of money that has been printed and will be printed and really the fundamental thought that you cannot have that much money in the system and not have it be inflationary.”
Similar sentiments are echoed by Gayeski of Skybridge Capital, who said in the light of extraordinary money supply growth, “we still think we’re in the early innings of the adoption cycle.”
“If you’re concerned about a currency debasement, if you’re concerned about the potential for more meaningful inflation,” which can be seen in the prices of copper, wheat, and lumber, then you don’t have that many choices said Gayeski.
While there is gold, it already had its adoption cycle, and the dollar is clearly going into crypto, he said.
The post Bitcoin Continues to Trade Below its 50-Day Mean; Skybridge Capital CIO says ‘Bull Market Still Younger’ Than Last Two first appeared on BitcoinExchangeGuide.
