Bitcoin Rebounds from Session Low, but Is It Ready for the $100,000 Mark This Time?
1min read The price of Bitcoin has retreated slightly from the psychological $100,000 milestone, as investors booked profits and deleveraged from the post-election rally. However, investors are still buying, indicating that enthusiasm persists for now.
The largest cryptocurrency is currently hovering at $94,515, rebounding from Tuesday's low of $90,000 after failing to top the $100,000 mark earlier in the week. Despite this, market enthusiasm remains strong.
"Bitcoin has been on a tear since Election Day with very few pullbacks, but the $100,000 mark remains a formidable psychological barrier," Mati Greenspan, founder and CEO of Quantum Economics, told CNBC. "While breaking through now would be a major bullish signal, a brief pullback may be needed to gather momentum before the next attempt."
With Bitcoin regularly hitting new records this month, long-term holders have increasingly been selling in larger amounts on the spot market. This selling pressure has so far been absorbed by inflows into Bitcoin exchange-traded funds, which ended a five-day advance on Monday and logged $438 million in outflows, along with large purchases by MicroStrategy.
"Historically, when new all-time highs are reached, there is typically a period of consolidation before further moves up," Brett Reeves of crypto infrastructure firm BitGo said "We know that new institutional money is coming into the space and retail activity is picking up, both via ETFs and exchanges. With positive macro and regulatory news ahead, we could see a quick pick-up in price activity."
Deleverage is surely the thing. Andre Dragosch, head of research for Europe at Bitwise, said Bitcoin was likely being kept below the psychological barrier as investors take profits from its sizable post-election jump. "Long-term holders have started to distribute significant amounts of Bitcoins into the recent rally," he noted.
Mark Novogratz, CEO of digital asset management firm Galaxy Digital, said last week that although he thinks Bitcoin reaching the six-figure milestone post-election is "inevitable," a pullback is to be expected. "There's a ton of leverage in the system right now. The crypto community is levered to the gills, and so there will be a correction."