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Bitcoin on Wednesday climbed back above $96,000, recovering slightly from a pullback this week that knocked it from record levels.
The price of the flagship cryptocurrency was last higher by 5% at $95,886.00, according to Coin Metrics, while ether jumped more than 8% to $3,591.33. The broader crypto market, as measured by the CoinDesk 20 index, gained 5%.
Although bitcoin is widely viewed as a store of value and a digital alternative to gold, the cryptocurrency often trades in tandem with the stock market. On Wednesday, however, it decoupled with the tech-heavy Nasdaq Composite, which was lower by 1%. The Dow Jones Industrial Average and S&P 500 dropped as well.
Coinbase was up more than 5% as bitcoin lifted it along with other crypto stocks. Robinhood, which offers crypto trading and is viewed as a beneficiary of a more crypto-friendly environment in the incoming Trump administration, gained 4%. MicroStrategy, which trades as a proxy for bitcoin, advanced 10%.
Bitcoin has been regularly hitting records since the Nov. 5 presidential election, up about 38% in that time. On Friday, it rose as high as $99,849.99 before testing the $90,000 support level this week.
“The bitcoin bull market has legs,” Alex Thorn, head of firmwide research at Galaxy Digital, said in a report Wednesday. “There will be corrections and hiccups, which is normal. There could even some twilight regulatory or law enforcement actions from the outgoing Biden administration that jitter markets. But a combination of increasing institutional, corporate, and potentially nation-state adoption, a new U.S. administration that is shaping up to be extremely pro-bitcoin, and solid positioning and network data all point to higher over the near and medium term.”
Fairlead Strategies’ Katie Stockton told CNBC’s “Squawk Box” on Monday that, at current levels, bitcoin investors are in “unchartered territory in terms of where there’s resistance — which, of course, there is none.” Meanwhile, support is around $74,000. Bitcoin reached $92,000 for the first time ever just two weeks ago, on Nov. 13.
“Bitcoin does tend to stair step both to the downside and to the upside, meaning that it sees these very sharp runups and then consolidates,” she said. “People should … be willing to give bitcoin, and the cryptocurrencies in general, more room because of the volatility there and also because of the long-term potential.”
Bitcoin is up 124% for the year and is still widely expected to reach the $100,000 milestone before the year is over. Ether, the outperformer since the election, is trailing bitcoin on a year-to-date basis with a 55% gain.
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