Yahoo Finance’s Brian Sozzi and Julie Hyman discuss Bitcoin’s price action and general market outlook with Craig Erlam, OANDA Market Analyst.
JULIE HYMAN: Let’s bring in Craig Erlam. He’s OANDA Market Analyst here. Joining us to talk more about not just crypto but what’s going on broadly in the markets. But let’s start with crypto, shall we, Craig? The action that you have seen recently, in Bitcoin in particular, what is that telling you? I know– it feels to me like when it comes to Bitcoin, people pay more attention to technicals. Is that what you’re watching as well?
CRAIG ERLAM: Especially when it’s in the absence of much news flow. Sometimes it seems that every day there’s a new Bitcoin-related headline. Something to talk about, something to get people excited, something to make people more pessimistic. That’s not always the case. Sometimes we’re kind of clutching at straws, trying to look for reasons to move these markets. But as we’ve seen so often, the markets move quite happily on their own.
They don’t necessarily need headlines. We look at the price action from the last few weeks alone. It looked like we were pushing new lows. It looked like we were just looking at support levels being broken. And there was incredible amount of resilience in the markets, despite the fact that it looked like technical levels had been broken. And once it started to generate some upside, that momentum really kicked into high gear, and all of a sudden, we were breaking $4,000 to $5,000, $48,000, $50,000. And it’s just kept going since.
And let’s face it, the last few weeks, I don’t think there’s been any major headlines. Yes, the US has said we’re not looking to ban crypto, but they weren’t for quite a long period of time. This was just a headline which generated it. Funnily enough, China wanting to ban crypto didn’t have the same effect to the downside, partly, again, because it’s been quite clear for some time that China’s been very anti-crypto.
But these markets do just sometimes have an inkling and do sometimes just have momentum. And when we saw so much resilience at $40,000, it started to become increasingly clear that, if we could break $45,000, then there could be incredible upside momentum, and that’s what we’ve seen.
BRIAN SOZZI: Well, Craig, if cryptos rise or– well, let’s just lock in on Bitcoin. If that move higher has been pushed by not a lot of headlines, does that raise the case or just raise the likelihood that we’re due for a correction here in the near term?
CRAIG ERLAM: Eventually. But I mean, you look at the charts, for example, and that’s all we really have to go off right now. And there just still seems to be plenty of momentum in the move. You look at some of the shorter-term charts, and potentially we’re going to see a little bit of profit taking around $60,000. But that all-time high, it’s just– the temptation around these levels, the idea that we could be seeing Bitcoin breaking into new territory,…