Bitcoin recently broke out of a trading range near $26,000 that had dominated for weeks.
Dreamstime
Bitcoin
and other cryptocurrencies held relatively steady on Wednesday despite a selloff in the stock market as rising bond yields heaped pressure on risk-sensitive assets. Traders remain bullish about big gains in the weeks ahead.
The price of Bitcoin has fallen less than 1% over the past 24 hours at $27,550, having hovered between $27,300 and $27,700 over the last day. The largest digital asset remains firmly above the $26,000 zone that had defined trading for more than a month amid a historically quiet period for cryptos, though Bitcoin has slipped lower from a recent peak above $28,000 earlier this week.
“Despite rising yields and dollar strength, Bitcoin has held up remarkably well due to limited selling and strong conviction from long-term holders,” said Alex Thorn, head of research at crypto financial services group Galaxy. “A clean break above $28,000 would pave the way for Bitcoin to begin to test the $30,000 range.”
Indeed, while the
Dow Jones Industrial Average
and
S&P 500
have sold off this week, Bitcoin has held relatively stable—above its previous range and barely shy of recent highs—despite a surge in bond yields. The yield on the benchmark 10-year U.S. Treasury note topped 4.8% on Wednesday for the first time since 2007 as investors remain worried about the outlook for interest rates.
Higher yields tend to add pressure to risk-sensitive assets, because better returns on risk-free government debt gives fewer incentives for investors to pile into riskier bets like Bitcoin. While climbing yields have hammered stocks this week, cryptos have held steady as traders continue to be bullish after a historically good September, which may pave the way for more gains in the month ahead.
“October has been Bitcoin’s best-performing month since 2014 (with the exception of 2018), with an average gain of 19.48% for the month over the last nine years,” Thorn said. “Market participants were actively positioning themselves for significant Bitcoin upside in October, with many willing to pay steep options premiums to capture potential gains.”
Beyond Bitcoin,
Ether
—the second-largest crypto—fell less than 1% to $1,650. Smaller tokens or altcoins were more mixed, with
Cardano
down 1.5% and
Polygon
up 3%. Memecoins were weaker, with
Dogecoin
dropping 2% and
Shiba Inu
shedding 1%.
Write to Jack Denton at [email protected]
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