Business Maverick: Battered Bitcoin devotees begin to contemplate a market bottom

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A buzz is building in crypto-investor circles and on Twitter about Bitcoin’s stealth July rally, which has beleaguered investors starting to ponder whether the largest digital asset has found a bottom.

Yet, given how intense the boom-and-bust cycles can be in the sector, many are also remaining cautious, unwilling to provide an all-clear sign given the mercurial nature of digital tokens – even as they see signs emerging of Bitcoin having found a floor.

Bitcoin has added roughly 15% over the past month through Friday, while other tokens, including Ether, have posted even better returns. Shawn Cruz, head trading strategist at TD Ameritrade, says there will need to be a shift in risk appetite before the coin can start to move significantly higher. Many are doing just that – watching equities for a guide-map of how things might play out for digital assets. Noelle Acheson, head of market insights at crypto-lender Genesis, points to an investor survey by Bank of America thatbleak sentiment and potential investor capitulation. Many stock observers see the poll as a contrarian signal.

There are plenty of other such analyses to be found for Bitcoin. The token and its brethren have gone through “one of the heaviest, and fastest downwards repricing events in their history”, wrote analysts at Glassnode, meaning that a ton of excess leverage has already been purged from the system. And for a floor to be established, investors need to experience “a wide-ranging capitulation event”, that causes seller exhaustion.

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