The DigitalX Ltd (ASX: DCC) share price has had a rather interesting time so far this week.
DigitalX shares experienced back-to-back gains on Monday and Tuesday this week, rising 15% on Monday and another 21.7% on Tuesday. Break out the champagne. But today, it's been a different story. DigitalX shares closed at 14 cents yesterday, and opened at 13 cents this morning (a loss of 7.15%) before dropping down to 12.5 cents. That's a loss of 10.7%.
But since open, the company has rebounded somewhat. It's currently trading at 13 cents, down 7.14%. So what on earth is going on here that could spark such whiplash-inducing volatility?
Well, to understand that, let's backtrack a little. DigitalX likely had such a strong start to the week due to the update it posted on Monday morning. As we covered at the time, DigitalX notched a new record high for funds under management (FUM) with $38.99 million as of 31 October. That figure represents a 36.8% increase on the prior month, helped by both inflows and booming cryptocurrency pricing.
This impressive performance was driven by DigitalX's two investment funds, the Bitcoin Fund and the Digital Asset Fund, which were up 37.46% and 27.82% respectively over the month. Year to date, these two funds are now up 105.7% and 285.7%, respectively.
These figures are probably behind DigitalX's breakneck share price appreciation earlier this week.
So why did the DigitalX share price get the wobbles today?
Image source: Getty Images
DigitalX share price takes a breather after its run
Well, it's not entirely clear. There has been no other news or announcements out of the company today (or yesterday, for that matter).
Cryptocurrency prices have pulled back slightly over the past 24 hours or so, with Bitcoin (CRYPTO: BTC) retreating from the record high of roughly US$68,500 it hit yesterday by around 1.8%. It's still asking around US$67,000 per coin at the time of writing, so not too much to phone home over.
It's possible that after the stellar run this company went on over Monday and Tuesday, investors have decided to take a break today and perhaps get some profits off of the table.
Whatever the reason for DigitalX's share price wobbles today, investors don't have too much to objectively complain about. DigitalX shares are still up 22.7% over the past 5 trading days, and up almost 93% over the past 6 months.
At today's DigitalX share price of 13 cents, this company has a market capitalisation of $103.55 million.
