● Guggenheim Claims Bitcoin will Reach 600k
● Ethereum Continues to New Highs
● USD Continues to Inch Higher
Hello again and welcome as always to this week's edition of Overbit Weekly Roundup. With January behind us, we now have one of the historically-worst months for markets. That being said, we'll take a primary look at the significant cryptocurrencies today in the hopes of gleaning where the overall market might take us in February and beyond.
Our first story revolves around Bitcoin and some strong feelings recently shared by the Guggenheim Chief Investment Officer, Scott Minerd.
Guggenheim is an international investment fund with billions of dollars in assets under management, making them one of the larger players in the financial space. Just under one week ago, Scott Minerd made headlines when he spoke with Bloomberg Television about Bitcoin. In this interview, Minerd expressed his scepticism of institutional interest at the $30,000 level, going as far to say that "Right now, the reality of the institutional demand that would support a $35,000 price or even a $30,000 price is just not there," Minerd said.
Just six days later, Minerd has almost entirely reversed his position on Bitcoin, stating that as the cryptocurrency market continues to grow, it only entices more and more investors who couldn't justify investing in a niche market. This is quite a curious turn of events, especially coupled with speculation that the 14,000 BTC outflow from Coinbase may have belonged to Guggenheim. Regardless, it seems even the most vocal nonbelievers are starting to reverse course, and at a much faster pace than before.
Moving on from Bitcoin, we'll take a look at arguably the second most important cryptocurrency, and at least the second most valuable - Ethereum.
Ethereum has consolidated at its resistance with a few wicks above it for weeks now, although it wasn't exactly the cleanest consolidation. Nevertheless, on Wednesday, 3 February, ETHUSD finally and decisively broke above the $1500 resistance level. At the time of writing, it now sits at $1688, a good 10% above its previous all-time highs.
This rally comes at an interesting time as the launch of Ethereum futures on the Chicago Mercantile Exchange (CME) grows nearer and nearer, with it set to launch next week on 8 February 2021. Year-to-date, Ethereum is up almost 120% versus Bitcoin's 30%, which might indicate a growing demand for Ethereum as investors hope it 'catches up' to Bitcoin. Either way, with such a big event looming on the horizon and ETHUSD breaking through all-time highs, it seems now more than ever would be an excellent time to put your eyes on Ethereum.
Closing out our last story of the week is the US Dollar. USD is reaching a six-week high against the Euro as investors become more confident of the US economy. The DXY was trading up .37% to 90.955. Kamal Sharma, director of G10 FX strategy at BofA Merrill Lynch Global Research, stated that the dollar might be more resilient in the near-term because "both growth and vaccination favour the US,".
The dollar is trading strong against the weakened Euro after Germany reported that its retail sales plunged 9.6% in December due to tight lockdowns to curb the spread of the coronavirus.
Wise investors would be mindful of the DXY and BTC/USD inverse correlation at times. In previous moments of a sharp rise in DXY price, there has been a sharp sell-off for BTC/USD, and with Bitcoin ranging in the 30,000s some investors feel like a lot of volatility is ahead.
Thanks as always for Reading Overbit.com's Weekly Round Up, where we cover the most important financial stories of the week and make sure to visit Overbit.com for all your trading needs.