- Bitcoin rose above $57,000 on Monday, extending its two-week rally.
- The cryptocurrency climbed to as much as $57,740.82, the highest level since early May, according to Coin Metrics.
Bitcoin extended its two-week rally Monday, climbing to the highest level since early May, according to Coin Metrics.
The cryptocurrency last traded more than 3% higher at $57,530.81 after hitting as high as $57,740.82.
The comeback — a gain of another 12% would take it back to its all-time high of about $65,000 — comes amid increasing hopes and expectations that a bitcoin futures ETF could be approved soon. That, along with recent comments from the heads of the Federal Reserve and Securities and Exchange Commission, who said they have no intention of banning bitcoin, seemed to "embolden" investors, Ned Davis Research noted.
Ben McMillan, chief investment officer at the quantitative index fund manager IDX, attributed the jump to increasing concerns about inflation being more than transitory as well as trading data that looks increasingly positive for the bitcoin price.
"We're looking at food prices that are at a 10-year peak, oil topping $80 for the first time in five or six years, and that's really hitting consumers in the pocketbook," he said. "A lot of investors are starting to look back to the original appeal of bitcoin as a store of value, as something that can't be weighed by any central bank."
Trading data shows the price action continues to be driven by institutional investors, McMillan added, particularly the size of the transactions and the number of large ones.
NDR's Pat Tschosik noted bitcoin and gold's one-year correlation has been dropping to the point where it's about to turn negative, meaning that the prices of the two are no longer moving in tandem.
"Bitcoin could be seen as the preferred inflation hedge if the dollar and real rates are rising," he told CNBC.
The cryptocurrency is now up nearly 30% for the month and 95% for the year. Many are expecting this rally to be the door to the next all-time high, though Ned Davis notes bitcoin tends to have a correction every 40 days, on average.
The latest run-up "follows a breakout above resistance from early September, which targeted the all-time high, so we would view any resulting consolidation as temporary," said Katie Stockton of Fairlead Strategies. "For those who are looking to add exposure, the implications would be to wait a couple weeks, noting that there is room to initial support defined by the cloud model, currently near [$47,000 to $48,000]."