Bitcoin’s rise despite the UK crackdown on Binance is a bullish signal that prices may have bottomed, Fundstrat says

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Bitcoin has fallen sharply since May. REUTERS/Dado Ruvic

Bitcoin’s rise in the face of the UK’s crackdown on major crypto exchange Binance is a bullish signal that suggests prices may have bottomed out, research firm Fundstrat has said.

The world’s biggest cryptocurrency rose from near $30,000 on Saturday to above $35,000 on Tuesday, despite the UK’s financial regulator banning Binance Markets Limited from operating in the country.

“This weekend’s price action represents a change in the market reactions vs. prior months where negative news had been taking us lower,” Fundstrat’s lead digital asset strategist David Grider wrote in a note on Monday.

“Prices rising in the face of bad news may be a sign of the seller exhaustion we need to go higher.”

Grider also said the bounce from around the $30,000 level was another positive sign for bitcoin. “This is the fourth time the price has come within the ~$30k range and found support,” he said.

“Prices holding the $30k level again may be a sign that we have in fact found the bottom of this crypto correction around those levels.”

He added: “We do think this could continue to be a choppy market for a bit as prices reestablish their trend and we could even retest the $31k levels, but overall, we remain in the bullish camp over the balance of the year.”

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Bitcoin soared in the first few months of 2021 to close to $65,000 in April. But it started to tumble in May after Elon Musk said Tesla would stop accepting payment in the token, due to its “insane” energy use. A crackdown on crypto payments and “mining” in China has also soured the mood.

Scott Minerd, chief investment officer at Guggenheim, struck a more pessimistic tone than Fundstrat last week. He predicted bitcoin would grind lower to around $15,000 before finding support.

JPMorgan analyst Nikolaos Panigirtzoglou told Insider earlier in June bitcoin may have to drop below $30,000 before institutional investors are lured back in.