(DAILY NOTION): BTC/USD: Bears Taking the Reins, Are the Bulls Completely Out of the Picture? Next Mover: Market Reaction to Biden Stimulus Package

22 Jan 2021, 10:24 · 阅读量 3,981

Source: Yahoo Finance

Is the BTC/USD bull run over? The flagship cryptocurrency took a sharp dip to $29,300 in the early hours of the Asia session. Other than being its lowest point since Jan 4, this also means that BTC/USD has now dipped 30% below its all-time high of $42,000.

The Relative Strength Index (RSI) is signalling a strong oversold condition at 18. The RSI had experienced a rather sharp decline from 74 to its present level, a staggering 76% dip.

According to analyst Lorenzo Stroe, a symmetrical triangle was formed on the four-hour chart with a price target of $27,200. Peter Brandt, a veteran trader, and analyst also believes that BTC/USD could reach $27,290. However, he believes that this is a healthy correction after an incredible bull rally.

While the recent bull run has triggered a sense of FOMO, or fear of missing out, in the market, one cannot help but wonder if this recent dip would trigger a bout of panic-selling in the market? At the same time, as markets anticipate the progress of the Biden stimulus package, can a higher risk-on sentiment in the market power the BTC/USD bulls more?

As the digital gold surged gloriously upwards in recent weeks, the U.K. financial watchdog had issued a warning this month that cryptocurrency investors should prepare to lose all their money. At the same time, large U.S. financial institutions have been including BTC/USD into their portfolio. Grayscale Investments are also using the opportunity during this latest dip to add 8,000 BTC into their portfolio.

At the end of the day, it is always important for traders to have a sound risk management strategy when trading. This can help to ensure peace of mind, whether in a bull or bear run.

BTC/USD (as of Jan 22, 2021, 9.50 a.m., GMT +8) - $30,106.68

FOLLOWME BTC/USD User Sentiment (as of Jan 22, 2021 at 10.20 a.m.)

Short – 35.47%

Long – 65.43%

已编辑 22 Jan 2021, 10:26

风险提示：本文所述仅代表作者个人观点，不代表 Followme 的官方立场。Followme 不对内容的准确性、完整性或可靠性作出任何保证，对于基于该内容所采取的任何行为，不承担任何责任，除非另有书面明确说明。

喜欢的话，赞赏支持一下

暂无评论，立马抢沙发

文章相关

Cryptocurrency

1.3K Posted · 1.8K Followers

BTC/USD

2,782 关注

更多内容

Any individual who followed Matt Damon’s advice that “fortune favors the brave” during the Super Bowl and invested $1,000 in the crypto markets have seen staggering losses, with the value of those assets dropping more than 60 %. This small slice of activity in the crypto markets demonstrates two major issues with this new asset class: its historical volatility and a lack of education about these assets among most would-be investors. Given that, as well as a cautionary regulatory environment, it’s clear that at this time, crypto has no place in defined-contribution plan lineups. This hasn’t stopped some DC plan administrators from soon making digital assets available to plan participants, if the plan sponsor decides to make this feature available. Read: This is why bitcoin won’t ‘diversify’ your 401(k) Defined-contribution plan sponsors will likely keep a close eye on these moves to make crypto more accessible to DC plan participants. For now though, we at Mercer do not view cryptocurrency or crypto-related assets as suitable investment options in a defined-contribution plan. Here are three key reasons why: 1. Volatility Proponents of cryptocurrencies point out that Bitcoin last year became the highest performing asset class of the decade, with an annualized return of 230 percent, when its price reached $60,000. But since then, its price has dropped precipitously, sitting at around $21,500 as of July 27. Of course, much of the stock market has entered bear market territory, bringing crypto along with it. But volatility is par for the course in crypto. According to a Mercer analysis, the annualized standard deviation of monthly returns of Bitcoin from 2015 to 2020 was approximately 80 percent, at least four times the volatility of publicly traded equities. Many experienced crypto investors may understand that these new markets reach new highs then crash in cycles, but it’s likely that most defined-contribution plan participants do not. Most participants don’t have the appetite for such high volatility—after all, as the primary vehicle that people rely on for their retirements, DC plans generally avoid making highly volatile asset classes available to participants on a stand-alone basis. Read: Why target-date funds may be sabotaging your retirement 2. Lack of education Given the amount of mainstream coverage around crypto, it can be assumed that these assets have become mainstream. However, only 16% of Americans said last year that they have invested in them. Based on Mercer’s work with some of the largest defined-contribution plan administrators, much is still to be done to educate plan participants on building a portfolio with crypto assets. This is vital, as learning about these markets can be confusing and time-consuming—a sobering fact in the face of Americans’ lack of financial literacy and their desire for professionals to help them plan for retirement. Learn how to shake up your financial routine at the Best New Ideas in Money Festival on Sept. 21 and Sept. 22 in New York. Join Carrie Schwab, president of the Charles Schwab Foundation. 3. The regulatory environment Although many in the crypto industry cheered when President Joe Biden signed an executive order in March instructing federal agencies to study and report on digital assets, there are plenty of reasons to be concerned that the regulatory environment around crypto may create more confusion in the markets. The day after the president’s order, the Department of Labor warned 401(k) plans to “exercise extreme care” about including crypto in portfolios. The agency wrote, “At this early stage in the history of cryptocurrencies, the Department has serious concerns about the prudence of a fiduciary’s decision to expose a 401(k) plan’s participants to direct investments in cryptocurrencies, or other products whose value is tied to cryptocurrencies.” The department cited crypto’s speculative and volatile nature as well as the difficulty to understand them as factors in its warning. (There is pending litigation against the DOL seeking to vacate this guidance, stating that where “assets may be invested should not be subject to the arbitrary whims of an agency that has no such authority.”)

Given the rapid decline of crypto markets, many believe regulators may soon place restrictions on the market. Hence, it’s prudent for defined-contribution plan sponsors to take a data-driven approach to including these assets in DC plan menus, despite a likely small minority of participants who may be requesting them. The crypto markets are constantly evolving, so it’s possible that the factors outlined above may be mitigated. But until then, we at Mercer feel that crypto does not belong in retirement accounts. Holly Verdeyen is partner and U.S. Defined Contribution Leader at asset management firm Mercer. Click here to see Mercer’s important notices.

Cryptocurrency

Dogecoin, Shiba Inu outperform bitcoin and ether. Is it a good time to bet on meme coins?

Cryptocurrency

Uniswap leads way as largest cryptocurrencies decrease

Cryptocurrency

Largest cryptocurrencies rise as Uniswap jumps

Cryptocurrency

Bitcoin Breaks $110K: Is It Too Late to Buy?

Cryptocurrency