Retail Sales on the Rise as Bitcoin Claws Its Way Back Up
CryptoCorner is a website dedicated to cryptocurrency.
Bitcoin’s 10% gain over the last two days begs the question: Is this a dead cat bounce or the start of a rally?
El Salvador became the first country to recognize Bitcoin as legal cash, and ForUsAll, a provider of retirement funds, announced intentions to allow employees to invest up to 5% of their 401(k) contributions in Bitcoin or other cryptocurrencies.
However, the world’s most popular cryptocurrency may have difficulties in the future.
The fact that Bitcoin’s spot price is higher than the futures price, according to JPMorgan Chase analysts, is a cause for concern.
In a research note, JPMorgan strategist Nikolaos Panigirtzoglou stated, “We feel that the return to backwardation in recent weeks has been a negative signal pointing to a bear market.”
The 21-day rolling average of Bitcoin futures on the Chicago Mercantile Exchange revealed insufficient demand among institutional investors, according to JPMorgan analysts.
Since dropping from a record high of about $65,000 in April, Bitcoin has been plodding along. Nothing has sparked the market or propelled the price above $40,000 so far.
The news is contradictory, and it doesn’t appear to be enough to bring the cat back to life. This could indicate that the market will continue to trade in a limited range in the near future.
During the present downturn, the Bitcoin market has split. Many regular investors sold during the downturn, ostensibly to reduce their losses, while most institutional investors bet on future price gains and stayed the course.
One of the biggest players intends to increase its Bitcoin holdings.
MicroStrategy, often credited with igniting the last bull market, said it would raise $500 million in debt to acquire more Bitcoin. This looks like a shrewd—and gutsy— decision to buy the dip.
Bitcoin trading volume is down, suggesting retail investors aren’t as active in the market as they have been in the past.
June trading volume is about 47% below May’s record level and the lowest since December, CoinDesk reported. That may impinge on a hot IPO. Coinbase Global, a cryptocurrency exchange, went public in a direct listing and opened about 52% above its reference price of $250.
The stock recently fetched $223.67, down from a high of $429.54 when shares first traded in April.
Coinbase’s results released last month showed that it earned $771. This is a brief summary.