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article imageBitcoin's price roller coaster ride over $17,000 before big dip

By Ken Hanly     Dec 8, 2017 in Technology
Bitcoin's price is continuing its wild roller coaster ride reaching a new high of over $17,000 before plunging down to just over $14,000 early Friday morning (Dec. 8) at about 6:30 a.m. Eastern Time, giving many investors on the ride whiplash.
Price showing wild volatility
The exact high was $17,153 according to Coindesk and its low was $14,095 a drop of approximately 18 percent from its high. By noon Eastern Time the price had recovered over a thousand to $15,130.
When I checked just after two Central TIme the price was close to $15,250 so it is still recovering slightly. The Coindesk chart shows the low for the day at $13,963 with the opening price at $16,858. The price is down about 9.74 percent on the day so far. However, the price is changing every minute. By the time I finish this article the price could be quite different so check it here.
Bitcoin began the year with a price well below a thousand.
On Thursday on the Coinbase exchange bitcoin actually hit a high of $19,340 before dropping like a rock. South Korean exchanges also often have higher numbers. Coindesk averages the results from several exchanges giving a better idea of the price at any given time. At times there are huge gaps between bid and ask prices.
Price level may show a short-term euphoria
Mark Newton, of Newton Advisors wrote in a recent note to clients: "It goes without saying that prices have reached a level where sentiment is exhibiting short-term euphoria. But to think prices are at mania levels where this could suffer a serious crash here… is a bit ridiculous. I truly don't think people are involved on a mass scale yet. We've heard the fraud claims. Now we need people profiting immensely all around us and making forecasts for $1 million, etc., for it to truly have reached a euphoric peak."
However there have already been predictions of that sort.
Cboe Global Markets (CBOE) is planning to start a bitcoin futures market on Sunday with the world's largest futures exchange the Chicago Mercantile Exchange(CME) set to also launch a market the following week. More investors are expected to put money into bitcoin. There is an interesting article at a CME site explaining some of the reasons behind bitcoin prices and its volatility.
The futures market will also provide another means to bet on the bitcoin bubble to burst.
The charge of the doomsayers
There have been many doomsayers with respect to the price rise of bitcoin. James Dimon the CEO of JPMorgan Chase has called bitcoin a fraud. Among others, the Nobel prize-winning economist Joseph Stiglitz calls bitcoin a fraud.
Several big banks including JPMorgan Chase and Citigroup will not clear bitcoin trades immediately. However, Morgan Stanley said it would clear trades for some clients. Many clients are clamoring for the service. Among many bitcoin supporters there is no love for banks as the bitcoin system is meant to bypass them and provide a superior financial transaction system.
Michael Novogratz former manager of the Fortress hedge fund said that cryptocurrencies such as bitcoin were "going to be the biggest bubble of our lifetimes". However, Novogratz also predicted just last week that bitcoin could reach a price of $40,000 by the end of next year.
That is a long-lasting bubble. Short sellers would be wise to wait for a while before jumping on the roller coaster ride. As I post this just after 4 PM Central Time the price of bitcoin is now at $15,994 just short of $16,000 on its way back up -maybe.
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