Crypto Stocks Surge as Analyst Says ‘Not The Time to Turn Bearish’ on Bitcoin
The crypto market experienced whiplash this week, with Bitcoin and related crypto stocks seeing a sharp selloff followed by a big rebound. After falling below $39,000 early in the week, bitcoin popped back above $42,000 on Friday, lifting crypto-focused stocks with it.
Bitcoin mining companies saw the biggest gains, with the likes of Core Scientific, Hut 8, and TeraWulf jumping 15% or more. Other crypto stocks like Coinbase and MicroStrategy, which hold Bitcoin on their balance sheet, also rallied 3-5%.
The initial catalyst for the selloff was profit-taking after the long-awaited Bitcoin ETF approval, which some saw as a “sell the news” event. Outflows from the Grayscale Bitcoin Trust and selling pressure from FTX’s bankruptcy estate added fuel to the fire.
Some analysts view the weakness as temporary, however. 10x Research head of research Markus Thielen believes macro tailwinds will support Bitcoin through 2024. He sees the U.S. election cycle prompting constructive fiscal policy that lifts asset prices.
“Even if Bitcoin ETF inflows disappoint, this is not the time to turn bearish as the macro environment will remain a tailwind in 2024, and the US election cycle will see a constructive fiscal response that will lift asset prices higher,” Thielen noted.
This morning, when #Bitcoin traded at 40,100 – we turned bullish. Our indicators signaled that Bitcoin could start to make a move higher after consolidating/correcting for the last three weeks when we warned that #Bitcoin could decline into the 36,000/38,000 retracement box.… pic.twitter.com/ewGzg3pnBd
— 10x Research (@10x_Research) January 26, 2024
It was a week of extremes for crypto exchange Coinbase, with wild share price swings after both an upgrade and downgrade from
