Investors should not be lured to buy Bitcoin simply because the price has dropped according to a foreign exchange strategist Boris Schlossberg. He says they should not fall victims to force hope and volatility is expected to run for several weeks.
He said this even as prices slumped to $10,400 Friday. But resumed to an upward trend to sell as much as above $15,000 Monday as of this writing. The drop caused Coinbase exchange to stop Bitcoin trades Friday. He said $10,000 is more of a floor price for the currency given that it marked the breakout three weeks ago.
Schlossberg says decline in price could affect Bitcoin holdings and investor sentiments because more traders will liquidate their positions and be encouraged to hold more traditional assets. More effects could occur in future due to less volatility in other capital markets according to the co-founder of BKForex.
Surprisingly, a CNN poll showed that more people are still buying Bitcoins against Schlossberg’s advice. As of early Monday, 48 percent of the polled 5,687 people said they were buying.
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Schlossberg’s latest opinion is against the advice he gave on May that people should include Bitcoins in their investment portfolios. And use it to hedge against market uncertainties. He said Bitcoin was the “new gold” and had ability to hold its value in the long term.