Yesterday, the BTC price dropped sharply after breaking the $35K support. Bitcoin declined over 25% in a span of hours in what was one of its largest single-day drops on record.
Volatility reached record levels on Monday as bitcoin plunged from its peak above $42K to hit lows of $30K in a wave of profit-taking.
Since then, mounting buying pressure from retail traders and long-term investors has sparked a decent recovery. BTCUSD surged by about 8% on Tuesday morning and breached $36,000 once again.
The coin reached an intraday high of $36, 100 before correcting slightly lower below $35K. As of this article’s writing, bitcoin is up 4% in the hourly chart to change hands at $34,339.
BTCUSD Chart By TradingView
Despite this swift 20% recovery, UBS analysts argue that the high volatility of the digital asset class and their past corrections’ enormous size is worrying.
The analysts concluded that crypto’s upside volatility might be attractive to speculative investors but disqualify it from becoming a suitable safe-haven asset.
Current BTC Market Resembles The Dotcom Bubble
The recent BTC price rally that has seen it rise more than 13% in a week and about 92% in a month has attracted the attention of many heavyweights in the world of finance.
Increased volatility over the past 24 hours saw Monday’s price candle register an $8,000 plunge following an impressive run past $40K just days prior. This unpredictability and growth have led one superstar investor to liken BTC to the Dotcom Boom and Bust of the late 1990s.
According to Mark Cuban, billionaire investor and owner of the NBA’s Dallas Mavericks, the current crypto trade is precisely like the internet stock bubble, which burst, leading to heavy losses for investors.
In a Jan 11 tweet, the billionaire warned that many crypto investors would likely lose their capital, similarly to what happened with the internet stocks. However, the investor had a positive outlook for BTC, ETH, and “a few others” crypto assets, which he believes will survive the bubble and thrive.
“I think BTC, eth , a few others will be analogous to those that were built during the dot-com era, survived the bubble bursting and thrived, like AMZN, eBay, and Priceline. Many won’t,” Cuban commented.
LTC Price Approaches Breakout
Litecoin (LTC) has seen a sharp correction over the past few days after forming a short-term top near $185. The coin tumbled along with ETH, BTC, and other top crypto assets and entered a bearish zone below the $125 support.
After the drop, bulls showed up near $115 and catapulted the LTCUSD pair higher in a decent recovery wave. As of this article’s writing, LTC is up over 17% on the hourly chart. The digital asset is trading at $138 as per data from CoinMarketCap.
The fifth-largest cryptocurrency needs to break above the $150 resistance to spark a breakout above the $165 and $170 levels.