As an experienced financial analyst who has closely followed the crypto market for several years, I’ve witnessed numerous price swings and their subsequent impact on related stocks like MicroStrategy Incorporated (MSTR) and Coinbase (COIN). The recent Bitcoin price rally to $65,000 was no exception.
The price of Bitcoin surged to reach $65,000 following a significant influx of buying power at the $54,000 mark last week. This surge was hindered by selling pressure instigated by the German government, causing a ripple effect on market sentiment. The crypto market experienced substantial sell-offs and retail traders were forced to abandon their positions in large numbers.
Above $60,000 and then up to $65,000, Bitcoin’s surge brought about a robust wave in the crypto market, invigorating altcoins. Ethereum reclaimed its position at around $3,500, Solana peaked at approximately $160, and Binance Coin attempted to reach $600.
Based on information from CoinMarketCap, the combined value of all cryptocurrencies increased, reaching a total of $2.4 trillion, as their prices rose. The fear and greed index also experienced an uptick, registering at 58.
As an analyst, I’ve noticed an intriguing development in the value of crypto proxy stocks. Specifically, MicroStrategy Incorporated (MSTR), being the largest institutional holder of Bitcoin, and Coinbase (COIN), have experienced a significant surge in their stock prices recently.
Assessing Crypto Proxy Stocks In The Wake Of Bitcoin Price Rally
As an analyst, I have observed that the price movements of crypto stocks, such as MicroStrategy (MSTR) and Coinbase Global (COIN), align closely with Bitcoin’s price and the overall crypto market. During bull runs, their shares experience significant rallies, mirroring the gains in Bitcoin. Similarly, corrections also tend to impact these stocks in a similar fashion. However, it is important to note that while crypto assets can exhibit extreme volatility, stocks like MSTR and COIN are generally less volatile compared to their digital counterparts. Consequently, investors may prefer holding onto these stocks during market fluctuations due to their relatively stable nature.
According to Yahoo Finance, MicroStrategy’s value reached a high of $1,736 in May, up from its previous value of $1,015. Following this impressive gain, there was a significant correction, with the value dropping to $1,202, reflecting Bitcoin’s price decline from around $70,000 to $54,000 between June and July.
As a crypto investor, I’ve noticed an intriguing correlation between Bitcoin’s recent trend reversal and MicroStrategy’s stock price surge. Over the weekend and this week, Bitcoin experienced a noteworthy shift in momentum, which was reflected in MicroStrategy’s share price reaching an all-time high of $1,668 on Tuesday. However, since then, MSTR shares have taken a slight dip, currently trading at around $1,594, equating to a 4.2% decrease on the day.
The price of Coinbase (COIN) stocks was around $246 during regular US trading hours on Wednesday. These shares have lately surged to reach $250, having previously dropped to $207.
If Bitcoin surpasses $70,000 in July and continues to rally, it’s reasonable to expect that the shares of MicroStrategy (MSTR) and Coinbase Global (COIN) will likely carry on their upward trajectories. Consequently, potential investors should keep a close eye on Bitcoin’s price movements to stay informed and prepared for any significant shifts in the market.
Bitcoin Price Rally Cools Off
After Bitcoin surpassed $65,000, a correction is picking up steam. This retreat could provide an opportunity for new purchases prior to Bitcoin reaching its anticipated goal of $70,000 by the end of the week.
In the meantime, it is expected that the support level will be found around $64,000. This level may be reinforced by a buy signal generated from the Moving Average Convergence Divergence (MACD) indicator.
If investors encounter resistance at $65,000 in Bitcoin’s price, it’s worth considering a profit-taking strategy as the cryptocurrency may experience a deeper decline. The 50-day Exponential Moving Average (EMA) lies at approximately $62,565, suggesting a potential downward trend toward this level. In more extreme circumstances, Bitcoin could search for liquidity around $60,000 before a larger price increase unfolds.
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2024-07-17 20:23