(Bloomberg) — Bitcoin rallied back Monday as investors took advantage of the lowest levels in seven weeks to pile back in.
The largest cryptocurrency rose as much as 12% to above $53,000, the biggest intraday gain since early February.
The move comes as JPMorgan Chase & Co. is preparing to introduce an actively managed Bitcoin fund to some clients as soon as this summer, Coindesk reported, citing unidentified people familiar with the matter. The rebound reverses a two-week slump that had pushed Bitcoin below its 100-day moving average amid technical warnings from Wall Street and fears of a growing crypto bubble.
Some pinned Monday’s move on a tweet Saturday from billionaire Elon Musk, who in the past has affected prices with his comments on the social platform.
In a potential reference to cryptocurrencies, the Tesla Inc. founder asked “What does the future hodl?”, using a term often seen as meaning “hold on for dear life” that supporters use to refer to buying and holding their digital assets.
“There is always a sharp movement when Tesla’s CEO talks about Bitcoin on Twitter ahead of quarterly earnings,” said Laurent Kssis, global head of exchange-traded products at crypto firm 21Shares AG. “As the U.S. wakes up, we could see further appreciation leading to $54,000-$54,500.”
Cryptocurrency-exposed stocks also rose. Monex Group Inc. gained 7.1%, while Remixpoint Inc. increased 7% and Ceres Inc. added 6.1%. In the U.S., Coinbase Global Inc. was up 4.6% in pre-market trading, while Riot Blockchain Inc. jumped 9%.
Bitcoin futures weren’t pricing much more in the way of further gains Monday, however. April contracts rose to $53,665, while those for May through September ranged from $52,145 to $55,635, according to data compiled by Bloomberg.
“Bitcoin created a large gap down last week that could stick around far longer than bulls would want to see,” said Rick Bensignor, president of Bensignor Investment Strategies, in a note Monday.
Bitcoin has done well over the medium term, retaining a gain of about 80% year-to-date as big-name investors endorse it and institutions from Goldman Sachs Group Inc. to Bank of New York Mellon advance their offerings around cryptocurrencies. JPMorgan’s John Normand reiterated in a note Friday that Bitcoin’s ascent has been steeper than any other financial innovation or bubble of the past 50 years.
“Crypto bulls breathed a sigh of relief as last week’s deep rout across the space failed to extend,” Steen Jakobsen, chief investment officer at Saxo Bank, wrote in a note. However, “it has quite a wall to climb to fully neutralize the recent selloff.”
(Updates with quotes, more context throughout)
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