Bitcoin price: Tech analyst says it could be ‘GAME OVER’ for bitcoin | City & Business | Finance
The prominent Renaissance Macro Research analyst warned the cryptocurrency could become “permanently impaired”.
Jeff deGraaf, the company’s head of technical research, said he would advise on betting against bitcoin if it fell below its support level for the year to date.
In a note to clients Thursday, which was seen by CNBC, Mr deGraaf said: “Parabolic moves are notoriously dangerous for short‐sellers.
“Usually a top develops that often appears as a descending triangle over months, with reduced volatility and little [fanfare].”
He added: “Once the top is complete on the support violation, the security in question can often be considered permanently impaired or even ‘game‐over’.
“We are of course referencing Bitcoin as exhibit ‘A’ in today’s market.”
Continued uncertainty over the Securities and Exchange Commission’s (SEC) decision whether to approve a proposed bitcoin exchange-traded fund (ETF) has caused bitcoin price to crash in recent days
Bitcoin lost a huge amount of ground on Wednesday, dropping 8.72 percent on the day to trade at $6,494.73.
Bitcoin price is at $6,474.17 at 20:00 (BST) on Thursday, according to CoinDesk. It saw its highest value before Christmas when it reached the monumental price of just under $20,000.
Despite bitcoin criticism, hedge fund CEO Dan Morehead said the bitcoin price will rise but warned that cryptocurrency mining does not have any fixed support like other markets such as copper so cryptocurrency companies risk running losses for months.
Mr Morehead told CNBC: “I think it is very difficult to ever do real-world calculations of the cost of mining.
“All these are sunk costs and people have built these enormous data centres with computer chips that are doing the mining.
“I think it is unlikely to have any fixed support there.
“The company might run a loss for six months hoping that the price is coming back.
“I think there really isn’t a level like in copper, where if you get below the marginal cost people just stop their mines.
“Here I think there isn’t some kind of fixed floor like that.”
He added: “Bitcoin was half this price a year ago and it was all working great.
“The price could go down but I really do think a year from now it will be much higher than it is today.”