Don’t expect bitcoin’s wild swings to relax anytime soon.
That’s according to Ari Wald, head of technical analysis at Oppenheimer, who says the cryptocurrency’s highly volatile action isn’t going away.
“You need to be able to stomach that volatility. It’s there to stay,” Wald said Monday on CNBC’s “Trading Nation.” “With the upside reward comes a lot of volatile day-to-day and even week-to-week action.”
Bitcoin fell nearly 3% on Monday after Federal Reserve Chairman Jerome Powell called cryptocurrencies primarily “speculative assets” and said the Fed was in no hurry to develop a central bank digital currency.
“Here’s something that can drop 20% and still hold all of its trend lines and support levels and leave the trend undisturbed,” Wald said. “Take for instance just the action last February. It made a high of about $58,000 and the next day was down to $44,000. It’s really been volatile and consolidating since then.”
Gina Sanchez, founder and CEO of Chantico Global and Lido Advisors’ chief market strategist, agreed with Powell that the crypto is not a great store for value, but also saw a different reason for its potential drop.
“As we reopen, … as money moves away from speculative assets, out of the riskier assets and quite frankly into goods and services spending, I think bitcoin’s going to get hit,” she said in the same “Trading Nation” interview.
Bitcoin has climbed more than 840% since the March bottom.