Cryptocurrency investors are once bullish and expect Bitcoin (BTC) to break record levels amid volatile trading ahead of pro-crypto President-elect Donald Trump’s inauguration on January 20.
The value of bitcoin, the largest cryptocurrency, rose 11% from Monday’s low below $90,000. It jumped nearly 3% in the last 24 hours, surpassing $100,000 at one point, according to data from CoinDesk.
The move to six figures, which boosted risk-taking in the broader market, came after a weaker-than-expected core CPI report that eased hawkish Fed fears that had driven prices down. Instead, markets are focused on Trump’s swearing-in and a possible pro-cryptocurrency announcement on his first day in office.
“Removing inflation fears paves the way for Bitcoin to break through the strong $100,000 resistance point ahead of Trump’s inauguration,” Matt Mena, crypto research strategist at 21Shares, said in an email. “Such a step would only be psychologically significant, but also technically significant, allowing Bitcoin to surpass its all-time high of $108,000 and set new all-time highs as market optimism strengthens. “21Shares is one of the largest issuers of crypto-native products. traded on the stock exchange (ETP) in the world.
“Trump’s well-documented support for pro-growth policies and his track record of aiding asset value appreciation increase the bullish outlook for bitcoin and risk assets in general,” Mena wrote.
This bullish forecast is consistent with a rally in classic assets, particularly the Nasdaq 100, which rose more than 2% on Wednesday. BTC recently strengthened its positive correlation with the high-tech index to succeed at its point in two years.
Meanwhile, the dollar index, which measures the price of the dollar against major fiat currencies, has stalled, offering a lifeline to risk assets, and the S
According to Mena, a break above 6,000 “could pave the way to the next level of the global asset bull market. “
Once a skeptic of digital assets, Trump courted the crypto community in months leading up to the November election, pledging to create a national strategic bitcoin stockpile. His victory helped propel BTC to over $108,000 from $70,000 to over $108,000.
“If Trump indicates on day one that he will create the strategic Bitcoin reserve, even if he doesn’t indicate it on day one, let’s expect value discovery to be asymmetric,” Nathan Cox, chief investment officer at Two Prime, said in an email. “Once the previous high of $108,000 is broken, there is no limit to how temporarily it can grow given the unprecedented call a Bitcoin reserve strategy could have globally. ”
Two Prime is an SEC-regulated registered investment adviser specializing in digital asset derivatives.
Paul Howard, a senior director at crypto market-making firm Wincent, said expected announcements related to regulating the digital assets industry, banking rules and creation of the strategic bitcoin reserve are not fully priced in yet.
“We are positioned for a volatile week ahead with the change of administration in the U.S. expect to see some +/-10% moves across the majors such as BTC, SOL, ETH, and XRP. Pricing will reflect outcomes of announcements by the incoming President, so opportunities, likely not everything, are baked into the current price,” Howard said.
Omkar Godbole is a Co-Editor of the CoinDesk Markets team founded in Mumbai, holds a Master’s degree in Finance and is a Chartered Market Technician (CMT). In the past, Omkar worked at FXStreet, writing research on foreign exchange markets and as a core analyst on the FX and commodities desk at brokerages founded in Mumbai. Omkar owns small amounts of bitcoin, ether, BitTorrent, tron and dot.
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