Bitcoin breaks above $7,000 amid wider risk-on rally
As risk assets regain their mojo amid optimism the coronavirus spread is beginning to level off, bitcoin’s back above $7,000.
The largest cryptocurrency gained as much as 6.4% Monday to $7,193, its highest in nearly a month. That’s its biggest one-day gain in two weeks and caps a near 11% rally for Bitcoin so far in April.
“Risk-on mode was evidenced across both crypto and non-crypto markets, as market participants reacted positively to signs that coronavirus outbreaks have started to stabilize in some of the worst-affected countries,” said Denis Vinokourov, head of research at Bequant, a London-based digital asset firm. “For bitcoin, it was more of a continuation of the trend that started last week, and, this time, bitcoin’s attempt to break above $7,000 was much more resolute.”
Bitcoin’s rally corresponds to a surge in equity markets. And the gains are a welcome reprieve for crypto fans following a brutal March that wreaked havoc on Bitcoin and peer tokens amid wider financial market turmoil.
If the current price can hold above this level, at least one technical measure suggests bitcoin could see a run to $8,000, where the coin was trading ahead of its massive drop last month. The $7,000 threshold was a solid support line for bitcoin between November and January -- remaining above it could provide support should it decline again.
Bitcoin could ascend to the $7,500 level, according to Craig Erlam, senior market analyst at Oanda. “It’s struggling to gather the momentum required to break the barrier down but as we know with bitcoin, that can change dramatically in a heartbeat,” Erlam wrote in a note. “If it breaks through those levels, then we could be looking at a healthy surge and another run towards $10,000.”