Bitcoin Steadies After Failing to Reach the Key $20,000 Level

(Bloomberg) -- Bitcoin pared a drop after earlier flirting with the $20,000 level and falling back as investors took profits from its surge this year.

The digital asset was little changed at about $19,232 as of 8:42 a.m. in London on Wednesday. This week, Bitcoin surpassed its all-time high from December 2017 and reached $19,914 before weakening again.

“Bitcoin volatility will remain high and for now it seems that the $20,000 level will remain a major hurdle,” said Edward Moya, senior market analyst at Oanda. Traders may be taking profits but institutions are keen to buy when the cryptocurrency dips, he added.

Bitcoin is up about 165% this year, a climb some ascribe to a widening investor base and growing appetite for new ways of diversifying portfolios amid expectations of ongoing dollar weakness.

While the level of recent selling “comes as a slight surprise,” other indicators point to “near and longer-term upward momentum,” said Ryan Rabaglia, global head of trading at OSL brokerage in Hong Kong.

Gary Cohn, a former economic chief to President Donald Trump, said in an interview with Bloomberg Television this week that Bitcoin “lacks some of the basic integrity of a real market,” underscoring ongoing skepticism over the surge in digital assets in 2020.

©2020 Bloomberg L.P.