Bitcoin: to the moon

Arnaud Masset Swissquote Bank Ltd

The price of Bitcoin broke another record yesterday as it crosses the symbolic $10,000 threshold. Not content to stop here, Bitcoin continued to rally during the Asian session and tested the $11,000 level. The pace of Bitcoin appreciation has accelerated recently as both institutional and retail investors keep piling into the crypto market. The likelihood of a bubble doesn’t scare anyone.

I think that there is plenty of room for further Bitcoin appreciation. There are actually several reasons. Firstly, although institutional investors already have a foot in the crypto space, the inflow of money if far from over as many big players haven’t move yet. The arrival of CME and CBOE derivatives will just make BTC investing much easier and will encourage skittish investors to take the leap. Secondly, several key projects, such as Rootstock or Lightning Network, which are built on the top of Bitcoin, that aim as improving Bitcoin’s scalability will be released soon. Finally, people are claiming that Bitcoin and crypto assets in general are in a massive bubble. Just before the dot-com bubble popped in March 2000, the market capitalization of Nasdaq hit $6.7 trillion. AS of this morning, the total market capitalization of crypto assets stands at $330 billions…

Stay on top of the markets with Swissquote’s News & Analysis

However, one should keep in mind that there would be most likely a clean-up in the crypto space next year. Many blockchain projects will just simply not make it.

In my opinion, a correction sounds healthy, as the price of Bitcoin has been on a mad run for the last few months. Nevertheless, investors’ appetite is massive and any corrections will likely be short-lived, as investors would take advantage of the move to buy on a dip.

Author

Arnaud Masset

Swissquote Bank Ltd

Arnaud Masset is a Market Analyst at Swissquote Bank. He has a strong technical background and also works in the development of quantitative trading strategies.

USD/JPY eyes August swing low, near 155.20 ahead of US NFP

USD/JPY retests the August monthly swing low during the Asian session on Friday as a more hawkish repricing of BoJ rate-hike bets and a suspected intervention continue to underpin the Japanese Yen. Meanwhile, the US Dollar is seen consolidating the previous day's heavy losses amid soft US bond yields, further weighing on the currency pair as traders keenly await the US NFP report.

AUD/USD consolidates above 0.7200; US NFP awaited

AUD/USD holds steady above 0.7200, near its highest level since mid-May, as bulls await the US NFP report for more cues on the Fed's policy path before placing fresh bets. Meanwhile, the recent decline in US bond yields keeps the US Dollar depressed near its lowest level in over a week and acts as a tailwind for the Aussie amid the RBA's hawkish tilt.

Gold tumbles as blockbuster US NFP lift US Dollar, Treasury yields

Gold (XAU/USD) falls sharply on Friday, snapping a two-day recovery after the US Nonfarm Payrolls (NFP) report surprised strongly to the upside. The metal briefly climbed above $4,500 on Thursday, gaining nearly 2%, but has since erased a large part of that advance.

Crypto’s $638 million buyback boom may not be as bullish as it looks

Decentralized Finance (DeFi) protocols reportedly spent $638 million to buy back their native tokens in August, up 17% from a year earlier. On the surface, the buyback trend suggests the cryptocurrency industry is maturing fast, adopting one of Wall Street’s oldest tools to bolster valuations and distribute revenue. The headline becomes less impressive once the number is opened up.

Why hawkish Bank of Japan expectations aren't enough to sustain the Japanese Yen rally

The Japanese Yen (JPY) experienced a sudden burst higher after falling back below the 160.00 psychological mark against the US Dollar (USD) earlier this week amid a more hawkish repricing of Bank of Japan (BoJ) rate hike expectations.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.