Equities reached new highs yesterday and then retracted to close slightly in the red. While investors are feeling bolstered by hopes of an economic recovery, the session’s focus shifted from risk assets to bonds. Treasuries were sold en masse, pushing the 10-year yield to 1.3% (levels not seen since 2019 and before the March crash of 2020). The dollar bounced and gold dropped about 1.35%.
Regardless of the equity bullishness that morphed into bearishness, the dollar gains, or the pick-up in yields, BTC had a great day. The session is closing up 2.3%, which in itself is nothing remarkable, but, during the session, we pierced through the $50,000 level. As a friend said yesterday, “now we’re only halfway there” (meaning halfway to the 100K point).
A look at options pricing shows the priced-in probability of hitting 100K by the end of the year, currently at 14%, which isn’t bad.
The venture into the 50K region was met by selling, though, and we’re not closing the session at $49,100. It’s worth noting that we observed several large inflows to exchanges like Gemini, Bitstamp, and Coinbase Pro, suggesting that some serious players were indeed happy to sell at those prices.
As one could’ve expected, with the milestone breached, the focus turned away from alts and towards BTC. The BTC dominance is now back up at 62.3 and alts indeed underperforming, meaning mostly flat in USD terms. However, one exception, DOT, bravely marched on to new highs, currently above 30. The amount of activity and interest in Polkadot these days is remarkable.
Away from pure price action, the big news yesterday was the announcement that MicroStrategy will be issuing $600 million of convertible notes that will be used to buy more BTC. Indubitably, this pushed us above 50K and is indeed supportive, as it will probably be met with enthusiasm and a quick—albeit significant—new round of BTC buying.
Will you be selling or buying this level?
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