Cryptocurrencies have gone ballistic.
In December, Bitcoin (CCC:BTC-USD) traded at just $22,761. Today, it’s up to $56,314 after hitting an all-time high of $60,717. Over the same timeframe, Ethereum (CCC:ETH-USD) ran from about $644 to $1,800 after briefly touching $2,029 in late February. Litecoin (CCC:LTC-USD) ran from about $91 to $200.56 after hitting a high of $240 in late February, as well.
All thanks to a long line of retail and institutional bulls.
Goldman Sachs (NYSE:GS) just restarted its cryptocurrency desk. JP Morgan (NYSE:JPM) could soon offer new cryptocurrency services. MicroStrategy (NASDAQ:MSTR) recently bought another $15 million worth of Bitcoin and don’t forget Square (NYSE:SQ) bought $170 million worth not too long ago. Two funds at BlackRock (NYSE:BLK) are investing in Bitcoin futures.
The list goes on. But when it comes to cryptocurrencies, not all are worth buying. Some are doomed to be duds.
But some have plenty of room to run even higher, including:
- Cardano (CCC:ADA-USD)
- Polkadot (CCC:DOT-USD)
Cryptocurrencies are still a volatile asset, but these tokens have enough stability to reassure investors.
Stable Cryptocurrencies With Room To Run Higher: Bitcoin (BTC-USD)
The most established, widely used cryptocurrency is Bitcoin.
After hitting a recent high of $60,717, BTC pulled back slightly to $56,314. However, further upside is likely because of two key catalysts.
First, unlike the 2017 bubble fueled by pure speculation, the latest rally has been massively fueled by institutional interest.
In fact, according to U.S. News & World Report contributor Gertrude Chavez-Dreyfuss, “Inflows into cryptocurrency funds and products have already hit a record $4.2 billion for the first quarter, reflecting growing institutional investor interest, CoinShares data showed.”
Two, some of the biggest companies in the world are buying Bitcoin, including Square, MicroStrategy, and Mastercard (NYSE:MA). Coupled with surging retail interest, that could send Bitcoin as high as $80,000 this year, if not beyond.
The last time I weighed in on Ethereum, I said it appeared, “technically overbought on RSI, MACD, and Williams’ %R. Plus, remember that parabolic rallies, as we’ve seen with Ethereum are not sustainable.”
That was on February 8, as ETH traded at $1,744. And admittedly, I was wrong, at first.
In the days that followed by note, ETH would rally to $2,026. But not even two weeks later, ETH would finally break down to $1,343 from overbought conditions.
These days, ETH is trending higher, but it’s once again overbought. Should ETH fail at double top resistance, it could pivot lower. So I’d wait for confirmation before jumping in at the moment.
Long-term I’m bullish on ETH.
According to Elliot Johnson, chief investment officer and chief operating officer at Evolve ETFs, as quoted by CoinDesk: “Ether is the building block for a revolution in digital finance which is still in its infancy. Ethereum is the most actively used blockchain, with ether being used to pay for transaction fees and computational services.”
Another stable cryptocurrency to consider is Litecoin.
For one, Visa (NYSE:V) recently launched an LTC-Visa card for use online and in U.S. stores. Two, more than 2,500 companies accept Litecoin as a form of payment. Three, cryptocurrency asset managers at Grayscale just bought more than 174,000 LTC over the last couple months.
However, don’t rush into LTC just yet. It’s also a bit overbought at the moment. Unless it can break above $246.92, we could see an overdue pullback in the near term. The last time LTC traded at this level was in 2018 shortly before it fell below $30.
ADA is another strong cryptocurrency you may want to consider.
It’s become so popular that KISS bassist, Gene Simmons recently invested $300,000 in ADA, tweeting:
“I just bought $300,000 of CARDANO (ADA). I’m not a Financial Analyst and I’m not telling U to buy or not to buy. Simply letting U know what I am doing and what I believe in. Why? Because I believe it’s going up… and it’s always up to you to research & decide”
Better yet, Cardano founder Charles Hoskinson believes ADA could one day dethrone Bitcoin. Fueling even more upside was news the coin is launching on Coinbase Pro.
Since bottoming out around three cents in 2020, ADA has skyrocketed to a recent high of $1.25. From here, I’d wait to see if ADA can break to new highs before buying. At the moment, it’s challenging a high we haven’t seen since the start of 2018.
Since the start of January, DOT has exploded from a low of $8.31 to a recent high of $35.15.
Founded by former Ethereum Project CTO Gavin Wood, DOT uses parachains, or multiple blockchains that can engage with one another.
“Polkadot’s big advance over other blockchains, which operate in silos, was to create an internet of interoperable blockchains for a decentralized web. It aims to allow all blockchains to link and work together and offer smart contract functionality,” reported Moneyweb contributor Ciaran Ryan.
On the date of publication, Ian Cooper did not have (either directly or indirectly) any positions in the securities mentioned in this article.
A contributor to InvestorPlace.com, Ian Cooper has been analyzing stocks and options for web-based advisories since 1999.