Bitcoin rose above $34,000 on Wednesday, taking it well above the critical $30,000 level that it breached on Tuesday and allowing it to recoup its year-to-date losses as long-term Bitcoin believers held on to their stash of the digital token.
Bitcoin was up 15.88% at $34,252 in morning trading on Wednesday. Ether, the No. 2 digital currency, was up 14.22% at $2,005.36, while XRP was up 23% at 65.14 cents. Dogecoin, the meme-currency that has suffered extreme losses over the past week amid cryptocurrency market turbulence, was up 38.48% at 23.82 cents.
Shares of cryptocurrency-related companies including Coinbase (COIN) - Get Free Report, Riot Blockchain (RIOT) - Get Free Report, Marathon Digital (MARA) - Get Free Report and Bit Digital (BTBT) - Get Free Report were also moving higher.
Cathie Wood's Ark Invest took advantage of the Bitcoin downturn on Tuesday by buying up another 214,718 shares of Coinbase, pushing its holdings to 4.7 million shares.
Bitcoin has lost more than 50% from its mid-April high of almost $65,000. The digital coin started 2021 trading around $29,000 following a fourfold increase in 2020.
Such trading signals “that Bitcoin traders could find themselves in choppy waters for weeks to come,” Sean Rooney, head of research at crypto asset manager Valkyrie Investments, told Bloomberg.
TheStreet's Jim Cramer said on his program on CNBC on Monday that he offloaded most of his Bitcoin holdings amid concerns over the recent crackdown on crypto mining by the Chinese government and Bitcoin’s role in some ransomware attacks.
“Sold almost all of my bitcoin. Don’t need it,” Cramer said on “Squawk on the Street” on Monday, more than two months after he first indicated he trimmed his position and paid off a home mortgage with those profits.
Chart-watchers including TheStreet's Bret Kenwell said Bitcoin, which failed to stay above $40,000 last week, could have a tough time finding support in the $20,000 range following its drop below $30,000.
"We have to respect the $30,000 area as support," Kenwell wrote. "It’s been support and until it breaks, it remains support. However, the more times a level is tested, the more suspect it becomes of failing.