Bitcoin crosses $40,000 to hit highest level since mid-May

Cryptocurrency receives boost from Amazon speculation and comments by Tesla’s Elon Musk and investor Cathie Wood

The Bitcoin logo on the display of a cryptocurrency ATM in New Hampshire. Market watchers have pointed to $40,000 as an important inflection point. AP

Bitcoin hit its highest level since mid-May and continues to build momentum.

The largest cryptocurrency gained for a 10th day and traded up to $42,390 on Saturday, its highest level since May 20. Market watchers have pointed to $40,000 as an important inflection point.

“A run like this certainly suggests some flow backing,” said Jonathan Cheesman, head of over-the-counter and institutional sales at crypto derivatives exchange FTX, in a note on Saturday. “Of course, it now needs to stabilise here – and above the high from May 20 would be further confirmation.”

Bitcoin, which for weeks trended downwards from its mid-April record near $65,000, has now spent more than a week building back as supportive comments from Tesla founder Elon Musk and Cathie Wood, investor and founder of investment management company Ark Invest, helped to bump it out of a declining trend.

Digital-asset related jobs postings by Amazon.com indicated that it may be entering the cryptocurrency sector after it posted a job seeking a “digital currency and blockchain product lead”. This helped Bitcoin as well.

Oanda's senior market analyst for North America, Edward Moya, offered a note of caution about the price moves.

“Retail interest is strong while institutional interest is somewhat lagging and needing fresh endorsements,” he said in a note on Friday.

“Bitcoin volatility might remain elevated at the weekend and traders should not be surprised if a [steep increase] occurs towards the $42,000 level during some illiquid times.”

Still, the world’s largest cryptocurrency has risen back above its 50- and 100-day moving averages, with the 200-day at $44,680 within reach.