The bitcoin price soared more than 10 percent over the last 24 hours, briefly hitting $11,840 on Coinbase.
The surge higher coincides with a blistering selloff on the Asian stock markets, triggered by a breakdown in US-China trade relations. It appears that bitcoin is establishing itself as a legitimate hedge to volatility in traditional markets.
Co-founder of Morgan Creek Digital Anthony Pompliano explained simply:
“Bitcoin is performing as designed during times of global instability.”
Bitcoin: a safe haven?
Speaking to Bloomberg, Jehan Chu of Kenetic Capital said traders are looking at bitcoin as a hedge to instability across traditional markets.
“With the turmoil in markets and the streets, suddenly digital gold doesn’t seem like such a bad idea. Bitcoin is increasingly seen not only as a bet on the future, but as a shelter for the present.”
The US stock market ended closed Friday on the worst week of the year after Trump reignited the trade war with China. The yuan fell below $7 – a psychological ‘line in the sand’ for China and a level not seen in more than a decade. Meanwhile, violence in Hong Kong sent Asian stock markets tumbling.
Among the market chaos, the bitcoin price and gold are among the only rising assets, strengthening the narrative of BTC as something of a safe haven.
Where next for bitcoin price?
In rising to $11,800, bitcoin has smashed through a number of key technical indicators. As trader Josh Rager explained, the bitcoin price ticked a bullish sign by closing the week above $10,9000:
“And there it is, the bullish reaction we expected as $BTC closed over the $10,900 on the weekly.”
The next key level is holding the current price above $11,469 to maintain the bullish momentum. After that, all eyes are on the 2019 high. As CCN.com reported, bitcoin hyper-bull Max Keiser sees BTC hitting $15,000 this week:
“I’m sensing #Bitcoin will cross $15,000 this week. Confidence in central governments, central banks, and centralized, fiat money is at a multi-decade low.”
History tells us that bitcoin often spikes 150 percent after a pullback. Assuming the recent low of $9,100 was the bottom of the short-term trend, a 150 percent rise would target $23,000.
Bitcoin dominance continues
Bitcoin’s move higher continues to leave altcoins in the dust. Bitcoin’s dominance is at 71.59% according to Messari; the highest since April 2017.
Institutional money coming into the industry continues to focus on bitcoin, while regulatory uncertainty on altcoins has subdued speculation beyond the major digital assets.
Click here for a real-time bitcoin price chart.
Last modified: March 4, 2021 2:39 PM