Bitcoin price approaches $19,000 for the first time since 2017

Cornelia Mascio
Novembre 27, 2020

Bitcoin climbed above $17,400, following a slide of as much as 14% to $16,227 on Thursday. Concerns relating to stronger crypto regulation and profit taking are the reasons cited for the huge drag.

"After big rallies in shares and various other assets, they are all vulnerable to a bit of a pause", said Shane Oliver, head of investment strategy at AMP Capital Investors Sydney.

Over the past few weeks or so, Bitcoin has been leading the crypto rally and is continuing to do so.

Crypto believers tout purchases by retail investors, institutions and even billionaires, as well as the search for a hedge against dollar weakness amid the pandemic, as reasons why the boom can last. Set against that is a history of big swings, including the run up to a record three years ago that was followed by a spectacular bust. Bitcoin is now trading near the previous breakout zone at $18,800. In October, PayPal Holdings Inc. said it would allow customers access to cryptocurrencies. A successful close above the $19,100 and $19,200 levels may perhaps lead the price back towards the $19,450 level. Crypto prices are approaching an all-time high, with many pointing to the wider acceptance of digital currencies among traditional investors as the catalyst behind the surge.

"It's also not unusual to see a short-term pullback following periods of significant, accelerated gains as traders look to take profits before resetting once volatility subsides", he said. Bitcoin's price rose as high as US$19,103 before paring the advance, trading up 2.2 per cent to US$18,817 as of 10:25 London.

"It continues to attract both institutional and retail attention as a 21st-century substitute to the gold play", he said.

"Bitcoin may be a victim of its own success", said Michael McCarthy, chief market strategist at CMC Markets Plc in Sydney. "Traders suggested several large holders moved to lock in gains as the cryptocurrency reached for all-time highs".

Breaking above $19,000 level happened faster than many crypto enthusiasts anticipated, specifically after Bitcoin price plunged to $18,000 in the evening session on November 23.

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