Bitcoin (BTC) passed $40,000 on June 14 as a consolidation period snapped to unleash a solid breakout.
BTC price breaks out past $40,000
The largest cryptocurrency capitalized on upside which resulted from a new positive tweet from Elon Musk over possible acceptance by Tesla in the future.
Earlier, Cointelegraph reported on traders betting on a leg up to around $47,000 before a correction.
A look at buy and sell positions on major exchange Binance showed support at $38,000, wit resistance at $40,500 the next hurdle for bulls.
Tudor Jones advocates 5% BTC allocation
Bitcoin reached a $2 trillion market cap because of a “dichotomy” in Federal Reserve policy which “questions” its credibility, says famous trader Paul Tudor Jones.
In an interview with CNBC on June 14, the founder of Tudor Investment Corporation sounded the alarm over advancing inflation.
After last week’s consumer price index (CPI) report showed that U.S. inflation had hit a 13-year high, Bitcoin’s deflationary nature has rarely looked so appealing.
For Tudor Jones, the idea that higher inflation is just temporary due to recent events, as suggested by the Fed and central banks in general, is a myth.
“It’s somewhat disingenuous to say, for them to say, that inflation is transitory,” he told CNBC’s Squawk Box segment.
Today’s environment is entirely different to that which saw episodes of inflation in the past, such as 2013, and as such, there is little sense in the Fed applying the same forecasts.
CPI was much lower then, Tudor Jones noted, while now, unemployment and jobs also roughly equal each other.
Meanwhile, gold and Bitcoin have provided a refuge for many. Despite the precious metal vastly underperforming Bitcoin in terms of gains, it remains near record highs.
“When you look at the Fed today and the Fed back then, you wonder how can you have such wildly different policy views on what constitutes the right levels for employment, the right levels for inflation,” he continued.
“How can you have that with an eight-year timeframe? It’s almost like a split personality and you wonder why Bitcoin has a $2 trillion market cap and gold’s at $1,865 an ounce. And the reason why is you have this dichotomy in policy that again questions — questions — the institutional credibility of something.”
Ultimately, a 5% Bitcoin allocation is one of the only things he advocates to those seeking portfolio advice.
“I say, ‘OK, listen, the only thing I know for certain is I want to have 5% in gold, 5% in Bitcoin, 5% in cash, 5% in commodities at this point in time,'” he added.