The record $41K level for Bitcoin’s price has just been hit but analysts wonder if massive corrections lie ahead. Let’s try and find out in the latest Bitcoin news today.
Bitcoin looked to end this week on a strong note as the price claimed another record high this Friday. The benchmark cryptocurrency skyrocketed above $41,000 for the first time ever and hit an all-time peak of $41,499 before correcting lower. Bitcoin’s gains happened shortly after the EU equities reported profits in the early dealings and hinted that the traders took cues from a bullish sentiment.
The benchmark Stoxx 600 opened 0.3 percent higher and made a strong finish of the week. In the meantime, the MSCI index which tracks developed market equities increased by 0.3% which is also on track to hit the record of its best week since 2018. The EUR/USD pair declined 0.30 percent and Bitcoin’s market capitalization reached $749 billion, reaching the one of Tesla. The gains across riskier assets happened after the Democrats won key seats in the Senate after the elections this week in Georgia. The victory gave the political party control of both Congress and Senate which means that for investors, there will be an increase in fiscal stimulus measures to aid Americans over the COVID-19 pandemic and the economic aftermath. Adam Kurpiel, the head of rates strategy at Societe Generale said:
“This is probably the best news for the economy since vaccines were approved.”
In the meantime, investors assessed lesser political uncertainty right after Donald Trump agreed to transfer power “orderly” to his successor Joe Biden who will take oath as the 46th US president on January 20th. BTC Analysts predicted that Biden’s administration and his stimulus measures could usher inflation alongside economic growth and they projected that the cryptocurrency will serve as an anti-inflation hedge and will rise higher. Independent analyst Elixium said:
“Now that Trump has conceded, we can expect Covid Lockdowns to get far worse in the U.S. just like they have in Europe in recent days. The Biden [administration] will make very srs attempts to get places like Texas & Florida in Full Lockdown. Bullish for Bitcoin, Bearish for USD.”
As retail traders raised bids for BTC against supportive fundamentals, the technicals seem to suggest a huge correction ahead. The record $41K level means that the cryptocurrency reached its most overbought levels and amounts to an unavoidable neutralization which will be led by the bears which is why analysts await for massive corrections.
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