MARA closes up 4.25% after securing new two-year high

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  • Marathon Digital stock jumped 12% on Tuesday’s open as Bitcoin price soared.
  • BTC advanced as much as 7% on Tuesday to reach above $57,100 for the first time since December 2021.
  • BTC halving is approximately 58 days away, leading the market to expect an uptrend.
  • Consumer Confidence and Durable Goods Orders leave the US market mixed.

 

Marathon Digital (MARA) stock rode the Bitcoin price wave on Tuesday. MARA shot up more than 12% at Tuesday’s open, while Bitcoin (BTC) advanced a solid 7% to $57,100 — its highest level since December of 2021 — before retracting to $56,800.

Marathon Digital, a Bitcoin and crypto miner in addition to other ventures, hit its highest share price since January 2022. However, MARA stock lost some of its luster as the session progressed, and its rally diminished to 4.25% by the session close.

The wider market is mixed on Tuesday after US Durable Good Orders and Consumer Confidence figures both underwhelmed economists’ consensus. The Dow Jones sank 0.25%, while the NASDAQ and S&P 500 gained moderately. 

Marathon Digital stock news: Halving narrative helps spur Bitcoin price

Several narratives and news bites have joined hands to lift Bitcoin’s prospects of late. First, the advent of spot Bitcoin ETFs in January created a whole new doorway for the asset as money poured into at least 11 funds that have been approved by the Securities & Exchange Commission (SEC). Word is that more are on the way.

All this new capital means that spot Bitcoin ETFs now account for 40% of the value of all Gold ETFs in just under two months. The ETFs make it easier for large investors to seamlessly invest in Bitcoin in the same way they would equities. Some ETF experts are already saying that Bitcoin ETFs will surpass the value of Gold ETFs in just two years. 

Then despite Bitcoin conquering the $50,000 level in just the past month, MicroStrategy (MSTR) announced it would spend $155 million on acquiring another 3,000 BTC. This was a sign of confidence from the software corporation that has pinned its entire legacy to the king of crypto coins. 

Additionally, the entire crypto ecosystem is staring with suspense as the calendar ticks inevitably toward the next Bitcoin halving. The current estimate based on mining hash rates is that the halving will commence in 58 days. This means that the current block reward handed out to Bitcoin miners like Marathon Digital of 6.25 BTC will be halved to 3.125 BTC. While miners gain less Bitcoin for their troubles, the price of Bitcoin tends to skyrocket in the 18 months following a halving. 

Just last week, Marathon Digital launched a new service called Slipstream. The unit “is a direct Bitcoin transaction submission service designed to streamline confirmations of large or non-standard Bitcoin transactions.”

S&P 500 FAQs

The S&P 500 is a widely followed stock price index which measures the performance of 500 publicly owned companies, and is seen as a broad measure of the US stock market. Each company’s influence on the computation of the index is weighted based on market capitalization. This is calculated by multiplying the number of publicly traded shares of the company by the share price. The S&P 500 index has achieved impressive returns – $1.00 invested in 1970 would have yielded a return of almost $192.00 in 2022. The average annual return since its inception in 1957 has been 11.9%.

Companies are selected by committee, unlike some other indexes where they are included based on set rules. Still, they must meet certain eligibility criteria, the most important of which is market capitalization, which must be greater than or equal to $12.7 billion. Other criteria include liquidity, domicile, public float, sector, financial viability, length of time publicly traded, and representation of the industries in the economy of the United States. The nine largest companies in the index account for 27.8% of the market capitalization of the index.

There are a number of ways to trade the S&P 500. Most retail brokers and spread betting platforms allow traders to use Contracts for Difference (CFD) to place bets on the direction of the price. In addition, that can buy into Index, Mutual and Exchange Traded Funds (ETF) that track the price of the S&P 500. The most liquid of the ETFs is State Street Corporation’s SPY. The Chicago Mercantile Exchange (CME) offers futures contracts in the index and the Chicago Board of Options (CMOE) offers options as well as ETFs, inverse ETFs and leveraged ETFs.

Many different factors drive the S&P 500 but mainly it is the aggregate performance of the component companies revealed in their quarterly and annual company earnings reports. US and global macroeconomic data also contributes as it impacts on investor sentiment, which if positive drives gains. The level of interest rates, set by the Federal Reserve (Fed), also influences the S&P 500 as it affects the cost of credit, on which many corporations are heavily reliant. Therefore, inflation can be a major driver as well as other metrics which impact the Fed decisions.

 

Marathon Digital stock forecast

Marathon Digital stock pulled back quickly on Tuesday from its two-year high at $32.87. That is of course a bad sign, but the new range high should provoke further entry from bulls. 

The $30 to $32 range provided support for much of 2021 and part of 2022, so traders will watch to see if MARA manages to use this price level as a base. Only a few weeks ago, MARA was trading near $16. 

MARA daily stock chart

Despite MARA stock’s recent spike in share price, the Relative Strength Index (RSI) sits at 65. That is a decent level for bulls since MARA stock does not yet look overbought here. The 70 RSI level is typically viewed as the threshold for an overbought status.

Another point of pride for bulls is that the 20-day Simple Moving Average (SMA) just recently overtook its 50-day SMA counterpart. This means that a longer rally is likely to enfold. The last time this happened, the November 15 to December 27 rally of 2023 was brought about.

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