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Bitcoin crossed the $11,000 level and traded near its highest level in nearly a year on Tuesday amid US dollar weakness and a broad shift to alternative assets.
The token leaped as high as $11,198.32 before paring gains and trading below $11,000 later in the day.
Cryptocurrency advocates argue digital tokens including bitcoin can one day replace the dollar and currently serve as a strong hedge against inflation.
Bitcoin’s rally comes amid a similar upswing for gold prices. The precious metal reached a record high on Monday as investors bet on heightened inflation expectations.
Watch bitcoin trade live here.

Bitcoin crossed the $11,000 mark in early Tuesday trading as the US dollar tumbled and investors turned to alternative assets including gold.

The cryptocurrency surged as high as $11,198.32 Tuesday before paring some gains and trading just below $11,000 per coin at 8 a.m. ET. Bitcoin is up roughly 52% year-to-date and about 23% since the start of July.

The token spiked higher on Monday after crossing the $10,000 level for the first time since June. Prices leaped as high as $11,298.22 late Monday evening to hit their highest in nearly a year.

Naeem Aslam, chief market analyst at AvaTrade, said the bounce “cleared a major psychological level that has been there for a long time,” adding the next key resistance level for the digital coin is $15,000.

The rally was helped by a growing argument among bitcoin bulls that the cryptocurrency can replace traditional stores of value. The dollar is down significantly year-to-date amid record levels of economic relief spending.

Gold, on the other hand, settled near record highs on Tuesday as the dollar’s weakness and heightened inflation expectations boosted the precious metal. Crypto fans have repeatedly touted bitcoin as a similar kind of hedging asset, as it isn’t directly tied to inflation and interest rates.

Other cryptocurrencies jumped early Tuesday before erasing gains and trading largely unchanged. Ethereum slipped after reaching its highest level in more than a year. Tether posted modest gains after its market cap crept above the $10 billion threshold.

Bitcoin traded at $10,916.45 per coin as of 8:45 a.m. ET Tuesday.

Author: Ben Winck

Source: Markets. Business Insider: Bitcoin rockets above $11,000 to year highs as the dollar weakens

  • The coronavirus pandemic will drag the US into a recession after a sharp decline to economic activity through the first half of the year, Goldman Sachs said Sunday.
  • GDP growth will slow to a halt in the first quarter before shrinking 5% in the second quarter, the bank’s analysts wrote.
  • The slump will be followed by a strong rebound in the second half of the year, they added.
  • While most recessions include two consecutive quarters of economic contraction, a looser definition used by the National Bureau of Economic Research would likely deem Goldman’s projection sufficient for an economic recession, the bank said.

The coronavirus’ hit to US economic activity will hit the second quarter the hardest and likely drag the country into a recession, Goldman Sachs said.

The bank revised its quarterly gross domestic product estimates in a Sunday note, lowering its expectations for near-term expansion and upgrading projections for later in the year. Economic growth will halt in the first quarter before contracting 5% in the second quarter, the analysts wrote. The US will bounce back through the end of the year with 3% growth in the third quarter and 4% expansion in the last three months of 2020, they added.

Goldman now expects annual GDP growth to hit 0.4%, compared to its former 1.2% estimate. How quickly the country can rebound depends on several unclear variables, including warmer weather’s effect on the infection rate and the effectiveness of social distancing measures, the analysts said.

“The uncertainty around all these numbers is much greater than normal,” they added.

The demand slowdown driven by coronavirus will most drastically hit the travel, entertainment, and restaurant sectors, the analysts wrote. Major US cities have already called for restaurants to operate on a take-out-only basis to curb additional infection. Complex supply chain problems and continued tightening in financial conditions will likely cut further into economic growth, according to the bank.

A recession’s technical definition calls for back-to-back quarters of negative growth, yet Goldman notes its single quarter of a sharp decline fits a looser interpretation. The National Bureau of Economic Research determines whether a US economic expansion officially begins or ends, and has previously deemed contractions lasting “just a few months” as sufficient for an economic recession.

Author: Ben Winck

Source: Markets. Business Insider: Goldman Sachs officially predicts a coronavirus-driven recession will hit the US, sees GDP shrinking 5% in 2nd quarter

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