Crypto services provider Matrixport, which has more than $3 billion in assets under management, has turned cautiously bullish on bitcoin, preferring to buy the recent price dip with a tight stop loss.
The leading cryptocurrency by market value fell over 10% on Aug. 15, testing the former resistance-turned-support level at $25,000. Since then, prices have been trading around $26,000, with many traders anticipating continued losses in the coming weeks.
Matrixport’s head of research and strategy, Markus Thielen, suggests otherwise.
“With tight stop losses, we would be long bitcoin, expecting lower treasury yields and a rally in U.S. tech stocks. We expected a 10% correction by the end of the summer, which we have gotten, and with the appropriate risk management approach, traders can try to be long again,” Thielen said in Tuesday’s market update.
A stop loss is a buy or sell order placed in advance to limit losses stemming from prices moving against the trade.
According to Thielen, traders should closely monitor bitcoin’s price for a potential drop below $25,800, as that would trigger the stop loss on the long position. As of writing, bitcoin was changing hands at $26,000.
