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Seeking Alpha 2024-11-21 18:43:00

Bitcoin Approaches $100K

Summary In the past 24 hours, the world's largest crypto has surpassed the $98,000 mark for the first time ever as it closes in on the $100,000 milestone. Bitcoin has been surging when the US stock market has been open outside of a slight sell-off from 2-4 PM ET. Forward one-month historical median seasonal returns rank in the 85th percentile of all days of the year, and forward three-month returns are even better, just shy of the top decile of readings. Bitcoin's ( BTC-USD ) relentless rally has pressed on. In the past 24 hours, the world's largest crypto has surpassed the $98,000 mark for the first time ever as it closes in on the $100,000 milestone. As shown below, after trending lower from the end of the first quarter through late summer, Bitcoin hit a low on September 6 and finally broke out of that downtrend by mid-October with a parabolic move upwards after the election. Currently, the crypto is up over 80% from that September low. Bitcoin has seen a lot of big green candles in the past few weeks. To gauge how it has traded during the day, below we show an intraday composite of Bitcoin's action since Election Day a little over two weeks ago. This is essentially the average 24-hour path that Bitcoin has taken since Election Day. We have shaded in gray the period from 9:30 AM ET to 4 PM ET, which represents regular trading hours for US equity markets. As you can see, Bitcoin has been surging when the US stock market has been open outside of a slight sell-off from 2-4 PM ET. Is this because of all the new Bitcoin ETF buying that has been happening lately? The surge in Bitcoin prices has also come at a time when seasonality hasn't exactly been at its best. In the second chart below, we show the average path of Bitcoin throughout the year for all years since 2015, over the past five years, and this year. As shown, this year in March and the second half of May, Bitcoin bucked seasonal trends as it saw much stronger runs versus a historical seasonal pattern in which prices have tended to fall. That parallels with this month in which prices have absolutely soared, whereas in the past, Bitcoin has tended to move lower in November before rebounding through the holidays. In fact, as the first days of December approach, forward one-month and three-month seasonality is reaching some of its strongest readings of the year. As shown in the dials below, forward one-month historical median seasonal returns rank in the 85th percentile of all days of the year, and forward three-month returns are even better, just shy of the top decile of readings. Of course, seasonality is no guarantee of future price movements, and the recent rally already leaves Bitcoin very overbought. Original Post Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.

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