Bitcoin rallied back Monday as investors took advantage of the lowest levels in seven weeks to pile back in.
Bitcoin rose for the first time in six days, climbing past $52,000 as bulls pushed prices higher in early trading hours.
The digital asset had been mired in a two-week slump after reaching a record on April 14, buoyed by enthusiasm from the Coinbase Global Inc. listing. Technical warnings from Wall Street, coupled with the collapse of two crypto exchanges in Turkey at the end of last week, had depressed sentiment amid fears over a growing bubble.
Traders are speculating whether bitcoin might be correcting. Prices tumbled last week by the most since February, amid concern that U.S. President Joe Biden’s proposal to raise the capital-gains tax on cryptocurrencies and other investments might weigh on the market.
On the technical side, bitcoin’s relative strength index – an indicator used to gauge trend momentum – shows the cryptocurrency is attempting a daily timeframe bounce from levels of oversold at 30.00 on April 25.
Other major cryptocurrencies were also in the green, gaining an average 3.7% on the day. Uniswap’s UNI token posted some of the biggest gains, rising more than 14% over the last 24 hours.
Bitcoin futures weren’t pricing much more in the way of further gains Monday. April contracts rose to $52,585, while those for May through September were mostly in the $52,000s, according to data compiled by Bloomberg.
“Bitcoin created a large gap down last week that could stick around far longer than bulls would want to see,” said Rick Bensignor, president of Bensignor Investment Strategies, in a note Monday.