Jeff Goldman, author of “Failed Traders: The 20 Common Mistakes Committed By Over 1,000 Losing Traders,” joined Benzinga’s PreMarket Prep show to discuss the recent volatility in bitcoin and why he has reduced his bitcoin holdings by about 50 percent in recent weeks.
According to Goldman, a long-time holder of the cryptocurrency, bitcoin prices have been extended for years now, but traders have simply been riding the positive momentum.
“I think it’s just way, way ahead of itself price-wise, and I probably could have said that at $2,000, $3,000, $4,000 or $5,000,” he said.
Running Out Of Steam
“It’s starting to roll over. There’s started to be some negativity from some big people. I think these Jamie Dimon comments along with all this China news that has been coming out is really the straw that broke the camel’s back.”
Dimon, the CEO of JPMorgan Chase JPM, didn’t mince words when describing bitcoin as a “fraud.”
“It’s worse than tulip bulbs,” Dimon said Tuesday. “It won’t end well. It will blow up.”
To make matters worse, China began shutting down bitcoin exchanges last week, including BTC China. Those moves sent bitcoin tumbling more than 30 percent from its all-time high earlier this month.
Related Link: Bitcoin Has A China Problem
Where Bitcoin Is Headed Next
Goldman hasn’t dumped his entire bitcoin holdings, but has taken profits on his stake as the cryptocurrency tumbles. Looking ahead, he said it’s very difficult to predict where bitcoin is headed next. In fact, he said bitcoin could end up valued anywhere between $50,000 and $0.
“[Bitcoin goes to]$50,000 if the hype keeps getting up there and more and more institutions get in. It’s obviously demand-driven,” he said. “Then you have people like Dimon come out and say it’s a fraud, then it could really go back to $200 for all I know.”
Bitcoin has a long way to go to get to $200, but it’s certainly been headed that direction of late. Since the end of August, the Bitcoin Investment Trust GBTC is down 37.3 percent.
Related Link: Ex- SEC Commissioner Suggests Owning Shares Of Companies That Use Bitcoin But Not The Currency Itself
Listen to the full PreMarket Prep episode below:
PreMarket Prep is a daily morning show about short term trading ideas and technical setups. It airs live from 8–9 a.m. ET here, and the podcast is here
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