Bitcoin falls back below $49,000 currently
Bitcoin is losing altitude after hitting all-time highs over the weekend, with Elon Musk’s tweet that prices “do seem high” contributing to a bout of profit-taking activity.
As mentioned yesterday, as much as Tesla’s announcement earlier in the month has pumped up Bitcoin, the drop yesterday marks the potential start of a struggling period – much like how things were when price clipped $40,000 at the start of the year.
From a psychological standpoint, there are many latecomers to the party and when everyone and anyone is starting to talk about it in casual conversations, that’s when you know that perhaps the euphoria has gone a little bit too far.
That said, if one is to look at Bitcoin as any other asset, institutional interest/demand is something to be mindful about – not to mention portfolio diversification.
As such, any major correction by as much as 15-20% may warrant dip buying but in a relatively wild asset class, the volatility range may be much wider to play around with.