Bitcoin rallied above $41,000 for the first time since its inception, reaching an all-time high of $41,499 before correcting lower.
The leading cryptocurrency’s gains appeared shortly after the European equities reported profits in early dealings, hinting that traders took their cues from a bullish risk-on sentiment.
Gains across riskier assets appeared after Democrats won key seats in Senate run-off elections this week in Georgia, giving the blue political party control of both Congress houses.
For investors, that means an increase in fiscal stimulus measures to aid Americans through the coronavirus pandemic’s economic aftermath.
Bitcoin analysts have predicted that Mr. Biden’s administration’s larger stimulus measure might usher in inflation alongside economic growth. They have projected the cryptocurrency as an anti-inflation set that would rise higher as the U.S. dollar loses its purchasing power over time.
However, Bitcoin’s technicals seem to suggest a massive correction ahead. BTC has reached its most overbought levels on all of its longer-timeframe charts, amounting to an unavoidable neutralization led by bear-induced sell-offs.
Should a correction occur, BTC/USD would test $40,000 as its interim support while keeping an eye on $36,000 as its primary downside target.
Founded in 2015, Coinchapter.com has become one of the leading resources for the crypto asset community. Created by a small group of cryptocurrency enthusiasts, Coinchapter.com was built to provide new members of the crypto asset community with unbiased listings of cryptocurrency exchanges and retail options that would allow them to buy the crypto assets that they wanted, how they wanted and at the price they wanted.