Not all optimistic bitcoin investors are thrilled with the Memorial Day long holiday weekend in the United States.
The sun, the fresh air, the barbecues, the first big summer break as more and more doses of COVID vaccines hit the arms of Americans and those in other parts of the world. This setup appears to be taking a back seat in the face of growing unrest over the downside that may crystallize further in the coming days for bitcoin BTCUSD,
and the larger crypto complex, including the dogecoin DOGEUSD,
et Ether ETHUSD,
on the Ethereum blockchain.
U.S. markets are closed on Mondays for Memorial Day, but crypto markets are open 24 hours a day.
Lamoureux is not the only one with Memorial Day anxieties. Billionaire digital asset entrepreneur Barry Silbert tweeted that he hopes bitcoin takes off over the weekend.
A report on CoinTelegraph hypothesized that bitcoin could fall further to $ 20,000 or less. Assets recently changed hands to $ 36,199, down more than 7%, on CoinDesk. Bitcoin is up 24% year-to-date but down 44% from its mid-April peak at $ 64,829.14.
Technical analyst Katie Stockton, who heads Fairlead Strategies, said bitcoin has benefited from short-term oversold conditions over the past two weeks, stabilizing at nearly $ 34,000.
However, she said she was struggling with her 200-day moving average. Technical analysts use moving averages as gauges of an asset’s long-term and short-term momentum.
“My near-term gauges are pointing higher, but we don’t have any compelling medium-term ‘buy’ signal,” Stockton said.
With that in mind, the technical analyst said that support near $ 34,000 could be threatened after more than one rebound, “so we have our eyes” on $ 27,000 “as a possible entry.”
Prices Dogecoin, the popular crypto meme conceived in 2013 as a light riff on the proliferation of bitcoin alternatives, changes hands at 31.6 cents, down more than 6%. Altcoin is down almost 60% from its all-time high earlier in May. That said, digital assets have grown 6,500% since the start of the year.
The # 2 crypto in market value, Ether, was down 9% and changed hands at $ 2,528, up almost 240% so far in 2021.
Even though they are volatile, crypto’s gains have for the most part exceeded those of conventional assets (with the exception of stocks even like AMC Entertainment Holdings AMC,
et GameStop Corp. GME,
Le Dow Jones Industrial DJIA,
for example, is up 0.3% on Friday and about 13% in the first six months of the year or so. The S&P 500 SPX index,
traded 0.3% higher on the session and expected a year-to-date rise of more than 12%, while the Nasdaq Composite COMP index,
was up 0.4% and heading for a gain of over 7% so far this year. GC00 gold futures contracts,
meanwhile, were up 0.3% on the day and up 0.4% year-to-date.
Lamoureux says crypto weekends have become notoriously treacherous because “because liquidity dries up” and “if there is blood in the water, sharks will lower that pressure and kill weak competition. who was in trouble.
The investor and strategist said the leverage in the system has also played a role in amplifying movement in digital assets.
A Barrons.com report by Avi Salzman explained that there are essentially two bitcoin markets: one dominated by traditional brokers like Coinbase Global and Robinhood and the other dominated by investors using derivatives that are care less about rising crypto prices and focus more on profitability based on directional movements of assets.
Volatility, therefore, can breed volatility in such an environment and there are few investors ready to step into the carnage if and when a downturn sets in.
There is no narrative that explains the change in momentum of bitcoin and its ilk. A number of reports have pegged it to comments from China in Japan, but crypto moves don’t always sync with the headlines.
Certainly, the crypto community has historically viewed the slides as buying opportunities, of choice for long-term investors.
However, new investors may face challenges when trying to withstand major dives.
Lamoureux said that a big factor that should provide support for bitcoin and mainstream crypto is the rise of so-stable currencies like Tether USDTUSD,
whose price is generally indexed to fiat money and is intended to see consistent prices.
Stable coins like Tether, for example, tend to be viewed as a gateway to crypto, as it’s easier to transact in other crypto using stablecoins. The market value of Tether is constantly increasing.