Once Bitcoin crosses $3100 Goldman Sachs would become bearish. That is what Interactive Investor reported a couple of days ago.
US investment bank Goldman Sachs announced that it becomes bearish on bitcoin, hence also cryptocurrencies, once it trades near all-time highs after it breaching $3,000. It said to be “wary of a near-term top ahead of 3,134. Consider re-establishing bullish exposure between 2,330 and no lower than 1,915”.
Goldman Sachs says hedge funds have started trading the virtual currency due to the lack of volatility in other asset classes. For the same reason, traders are also being attracted to the cryptocurrency market in increasing numbers. Prices between exchanges vary considerably, offering arbitrage opportunities for day traders.
The flipside of Goldman’s bearish call comes from Jean-Marie Mognetti, head of trading and operations at XBT Provider, reported how volume in cryptocurrencies went up to a never seen level, particularly in the last 60 days. Interestingly, and importantly, this “unprecedented volume in trading and demand stems from both retail and institutional investors.”
On Tuesday 13 June, Morgan Stanley released a report – ‘Blockchain: Unchained’ – in which it further underlined its commitment to exploring the value in the blockchain distributed ledger technology on which cryptocurrencies such as bitcoin are built, but sounded a note of caution regarding the run-up in price, drawing attention to the lack of regulation:
Possible explanations include investors in search of uncorrelated risk assets and technologists looking for incremental security. But governmental acceptance would be required for this to further accelerate, the price of which is regulation.
Its statement is thought to have taken some of the froth off the red-hot market.
Pretty interesting to see these bullish and bearish predictions cross each other.