Bitcoin bounces — why 'bad narratives' have one trader staying neutral

Bitcoin is bouncing again from its latest lows.

The cryptocurrency climbed almost 9% on Wednesday after hitting a three-week backside Tuesday, fueled partly by El Salvador becoming the first country to just accept bitcoin as authorized tender. Interactive Brokers also said Wednesday that it could launch crypto buying and selling on its widespread platform by the tip of the summer season.

But important obstacles stay, long-term bitcoin bull Todd Gordon instructed CNBC’s “Trading Nation” on Wednesday.

“We’re recently short bitcoin. We’ve covered it,” stated the founder, including that he is nonetheless a long-term holder. “There’s a lot of sort of bad things, bad narratives weighing against it.”

With buyers nonetheless reluctant to embrace it as a retailer of worth, competitors from ethereum rising, the governments of China, Turkey and India cracking down, and Tesla CEO Elon Musk elevating environmental considerations, bitcoin’s headwinds aren’t precisely few and much between, Gordon stated.

“If we look at the technicals, you saw a 53% drop in 2019, a 62% drop in ’20 and we just saw a 53% drop. So, we could go a little bit lower, but right now, I think we’re neutral,” Gordon stated.

He steered watching some key inflation information — the buyer value index (CPI), set to be launched Thursday — for hints on the place bitcoin might head subsequent.

“If that CPI number is not hot, watch bitcoin’s reaction and that’ll start to tell you maybe it’s an inflation hedge,” he stated.

One fellow bitcoin bull wasn’t as anxious for the close to time period.

“I’m still bullish and still buying,” Delano Saporu, founder and CEO of New Street Advisors Group, stated in the identical “Trading Nation” interview.

With El Salvador, “you’re seeing a country that’s going to possibly be able to level the playing field for a lot of folks,” Saporu stated.

“They mentioned 70% of people in the country aren’t able to have financial services readily available,” he stated. “That’s one of the use cases that a lot of people are bullish on when it comes to cryptocurrencies in general, so, we’re definitely still buying and definitely still bullish.”

Disclosure: Gordon owns bitcoin and shares of the Grayscale Bitcoin Trust (GBTC). Saporu and New Street Advisors Group personal bitcoin.


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