Bitcoin (BTC-USD) prices fall below $28,000 after Coinbase (COIN) received regulatory approval to offer crypto futures. Yahoo Finance Markets Reporter Jared Blikre explores the price action surrounding the crypto space and how crypto-related stocks are faring ahead of Thursday’s closing bell.
Video Transcript
JARED BLIKRE: I haven’t talked about crypto in a while. Let’s take a look at the Wi-Fi interactive, where we are seeing some definite downside action, and not only Bitcoin but Ethereum. Each down about 4%. And here is a three-month chart of Bitcoin.
And you can see, after reaching this local peak here in early July, it has just been a steady slog down for Bitcoin, now reaching the lowest levels in about two months and also having the worst day in a month. Just haven’t seen much volatility lately. In fact, most days you see crypto doing practically nothing. So kind of in and of itself, something worth mentioning.
A couple of things on the horizon here, we just got Coinbase, one of the biggest brokers in the world, also in exchange, got permission from the Commodity Futures Training Commission only yesterday to become a futures commission merchant. So this is going to mean that they can sell to their customers futures contracts in both Bitcoin and Ethereum, anything else that comes down the pike that’s authorized by the CFTC. It doesn’t really change the regulatory game that much.
They still have problems with the SEC, but it does kind of make the SEC look out of step. So let’s get back to the charts here. Here’s Bitcoin. I was showing you the last three months. But interesting thing that’s happening over the last year, guess what?
We are now poking just below this lower trend line. So really, the bulls want to get above $28,000, $28,500 pretty soon here. Otherwise, it’s going to start looking like a breakdown. Now, crypto is known for a lot of false breakdowns. I’m always on alert for one of those, and that usually happens over the course of a few days.
So we’ll look to see what’s happening here in the crypto universe. I can also take a look at some of the crypto stocks. This is just what’s happened today. Some of these names like Riot Blockchain down 10%. But a lot of these names have simply been decimated.
Here is a year to date look though. You can see huge, huge gains. Let’s take Mara for instance, Marathon Digital Holdings. The local minimum was in January, had a big peak in July. But most of these assets have sold off in the general risk-off fever that we’ve had, and a lot of that simply has to do with interest rates.
We’ve had the long end of the curve. This is a 10-year T-note yield over the last three months. This has been absolutely screaming higher. That puts pressure on Bitcoin. Bitcoin does not offer a rate of return.
So the thinking goes, well, higher rates, missing out on something there. There is another alternative. So just in general, when we have these rates screaming higher, it’s an easy excuse to sell Bitcoin, and perhaps that’s what’s happening here. But really want to see $28,500 in the near future for Bitcoin bulls. Guys.
– All right. Jared with the levels for us to watch. Jared Blikre at the New York Stock Exchange. Thank you so much.
