After falling 3.3% in line with the S&P 500, Bitcoin is back on the move today.
The leading digital currency surged as high as $13,500 on the back of an increasing ‘real’ volume of over $2.1 billion.
According to one trader, “If BTC rises above 14,000, it will challenge the all-time high at 20,000. If that is broken (which I believe it would be) we could see BTC hit 65,000-80,000 by mid-2021.”
There are literally only two resistances left on the #bitcoin chart – 14,000 and then the old all-time high at 20,000. I fully expect new all-time highs by early next year at the latest.#irresponsiblylong pic.twitter.com/Xhp8qgHrAC
— Raoul Pal (@RaoulGMI) October 27, 2020
Altcoins aren’t feeling that good either as Ether trades in the red at around $400. And although “ETHUSD did a fairly nice bounce from support,” trader Loomdart is still pretty bearish on it.
The majority of cryptocurrencies are currently recording losses, but a few coins like TEND (+32%), CREAM (+19%), Curve (+15%), and COMP (10%) are still reporting gains.
While BTC enjoys gains, traditional markets could see volatility with the stimulus not coming before the election as Senate Majority Leader Mitch McConnell motioned for the Senate to adjourn until November 9.
With this move, the Senate has been shut down, meaning it won’t be doing any legislative business, including reaching a deal on additional coronavirus relief packages. This came right after Judge Amy Coney Barrett’s confirmation to the US Supreme Court with 52-48 votes on Monday.
Shorting the Greenback
In 2020, we have seen a strong negative correlation between the USD and BTC. Today, a jump in Bitcoin’s price came as the US Dollar index dropped under 93. But the falling USD isn’t helping other assets as gold continues to trade around $1,900.
The world’s biggest money manager, BlackRock, is also shorting the greenback on expectations that unprecedented fiscal and monetary stimulus will extend its losses, notwithstanding who wins the US election, which is just a week away.
The company holds a “modest” short in the US Dollars against the likes of Chinese yuan, Indian rupee, and Indonesia rupiah — three Asian nations among those best positioned to benefit from a weakening dollar.
“My base case is that we still have at least one- to three years of more moderate dollar weakness on the cards — that’s not going to change,” said Neeraj Seth, head of Asian credit in Singapore. “Regardless of the election outcome, some of the policy actions have already happened.”
The $7.3 trillion giant has joined its peers, including UBS Asset Management and Goldman Sachs Group.
“The dollar still is on the expensive side from a fundamental standpoint,” he said. “I don’t think that direction reverses or changes because of elections.”
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