Bitcoin secured yet another record high level on Wednesday, helped by news of Anthony Scaramucci’s SkyBridge Capital investment’s investment into the cryptocurrency space.
The benchmark cryptocurrency topped at $28,580 during the Asian morning session after reports revealed that the investment management firm had purchased $182 million worth of Bitcoin. The news soon followed a dramatic stablecoin inflow into the cryptocurrency exchanges, pointing to traders’ willingness to “buy-the-news.”
Bitcoin price vs. Exchanges' stablecoin inflow. Source: CryptoQuant
Nevertheless, the BTC/USD exchange rate sharply reversed its course owing to profit-taking sentiment among daytraders. The pair remained in the negative area throughout the European session, falling to as low as $27,311 in the early trade.
Bitcoin finds support at the 20-period MA curve near $27,000. Source: BTCUSD on TradingView.com
Part of the reason could be Britain’s fresh approval of the COVID-19 vaccine developed by AstraZeneca and Oxford University.
Hani Redha, a multi-asset portfolio manager at PineBridge Investments, called it an “important development” in the global fight against the pandemic. Unlike its peers, the AstraZeneca-Oxford vaccine will have more doses to transfer across the developing countries against comparatively higher temperatures.
“Just the sheer number of doses there will be and the fact that distribution of it is easier, particularly in developing countries, makes it important,” he noted.
Investors grabbed the vaccine news as their cue to increase their short-term exposure in the risky markets. The pan-European Stoxx 600 index climbed 0.11 percent, while the FTSE 100 index on the London stock exchange posted a modest 0.1 percent gain.
Bitcoin, on the other hand, appeared sidelined.
A Bitcoin Run-Up to $30,000
Meanwhile, a weaker dollar limited Bitcoin’s post-high losses amid a thin trading session.
The US Dollar Index, which measures the greenback’s strength against a set of foreign currencies, fell to its lowest levels since April 2018. So, while on the one hand, the vaccine news troubled Bitcoin traders, on the other, a weakening dollar safeguarded their medium-term bullish bias for the cryptocurrency.
Investors view Bitcoin as a hedge against inflation and current debasement. Meanwhile, The US dollar is a global reserve asset that has fallen by more than 12 percent from its mid-March highs. Its plunge has followed a massive stockpiling of debts by the Federal Reserve and the US government’s two stimulus packages of a combined worth of more than $3 trillion.
#bitcoin = 15 ounces of gold. Up from 5 ounces end 2019 and 3 in 2018. Note there is no USD in this formula or chart. This is the pure S2F effect without QE / Brrr. 100x gold implies $188K bitcoin (at current gold prices; gold will probably increase in price due to QE). pic.twitter.com/5uXZVs0Rnr
— PlanB (@100trillionUSD) December 30, 2020
Entering the US session, the anti-fiat sentiment could prompt further upsides for Bitcoin’s ongoing bullish move. A pseudonymous analyst believes the cryptocurrency could close towards $30,000 based on a reliable technical indicator.
Bitcoin is brewing for another upside push, as highlighted by IncomeSharks. Source: BTCUSD on TradingView.com
“Bitcoin’s SuperTrend,” the analyst noted, “on the daily gave a buy at $11,000. It is yet to flip bearish. Almost a 155% move just following this indicator. Every support touch has been a great buy opportunity (loaded up at $16,000 most recently).”
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Author: Yashu Gola