Bitcoin declined for the first time in five trading sessions, with losses accelerating after it failed to sustain the positive momentum seen following this past weekend’s flash crash.
Q3 2021 hedge fund letters, conferences and more
The largest digital token slipped below the $50,000 level, with losses extending in afternoon trading in New York. Bitcoin was down 6% to $47,602 as of 4:06 p.m., while other digital assets also dropped. Smaller ones, including Monero and EOS, were among the hardest-hit.
And on a technical basis, Bitcoin is seen by some analysts as being caught in a no man’s land between different moving averages. The coin might be forming what’s known as a head-and-shoulders pattern, which would be a bearish development.
“The problem with crypto is, who’s going to catch that falling knife?,” Cate Faddis, president and CIO at Grace Capital, said in an interview on Bloomberg TV. “I am very concerned about crypto — honestly, it reminds me of ‘08 with the real estate and it could spread to the entire market.”
“People have to understand truly, in my opinion, what it is. It’s a speculative investment,” Chuck Cumello, president and chief executive officer of Essex Financial Services, said by phone. “A more mainstream investment doesn’t drop 20% on a weekend. That just doesn’t happen.”
Cryptocurrencies have posted wild moves over the last few sessions, most notably over the past weekend, when many were swept up in a broader risk-off wave that also hit U.S. equities. It happened as spiking inflation is forcing central banks to tighten monetary policy, threatening to reduce the liquidity tailwind that lifted a wide range of assets. The largest crypto ended up losing as much as 21% during that decline.
Read the full article here by Vildana Hajric, Advisor Perspectives
